When purchasing a new home or property, there are many things to consider beyond price, location, and square footage, particularly if it’s a vacation home near a flood zone or the coastline. These picturesque homes that check all your “want boxes” have more considerations to be appreciated.
Don’t be blinded by ocean-front property and/or open fields of solidarity and fail to consider the possibility of storms and wildfires. While there will always be things that are beyond our control, no matter where you choose to purchase a home, here are five things you should know about high-risk property that could affect your insurance policies.
1. Winter storms
While disasters can happen anywhere, some places are better known for their fair share of winter storms. They often bring a combination of freezing rain, ice, snow, and high winds that can cause power outages for days. What's more, when that ice and snow melts, it can lead to severe flooding. If you’re not prepared to live in abnormally cold days all season long, take a look at FEMA’s map to determine the risk of winter storms in the area you live or plan to live.
Floods are the most common natural disaster in the United States. From 2003 to 2012, total flood insurance claims averaged nearly $4 billion per year! The scary part of it all is that it can happen anywhere it rains and particularly in areas that experience high annual rain totals. A flood can occur with just a few inches of rain, and cost tens of thousands of dollars in damage.
The first thing that every homeowner should be aware of is that EVERY HOME, no matter where it's located, is in a flood zone. And that means, every homeowner should have enough flood coverage to fully protect their largest investment. That means, you need standard NFIP flood insurance if your home value is less than $250,000 and standard flood insurance PLUS additional excess flood coverage if your home value is greater than $250,000. When a home is in an area more prone to flooding, lenders will require a borrower to have adequate flood coverage, but just because your lender doesn't require flood insurance, doesn't mean you don't need it.
3. Tornadoes, Thunderstorms, and Hail
According to the Insurance Information Institution, from 2000-2013 Oklahoma and Texas led the nation in insurance claims payouts resulting from tornadoes, thunderstorms, and hail catastrophes. The article states, “Total U.S. natural disaster-caused insurance claims payouts came to $12.79 billion in 2013, with 10.27 billion of that figure attributable to tornadoes and severe thunderstorms.”
No matter where you live, it’s difficult to determine when and if these catastrophic events could occur. Err on the side of caution and consider purchasing an insurance policy that covers these instances to protect you from an unfortunate situation.
Of the most high-risk possibilities, it seems wildfires are among those that could be the most preventable. If you’re searching for property in desolate or dry, windy areas, there are many things you can do to protect your property. Ready.gov provides a checklist on how to prepare for a wildfire.
Wildfires are known to spread quickly, and even if you are prepared for the worst, your neighbors may not be as cautious. Besides properly insuring your home, work to educate those living around you to collaboratively put an emergency plan in place.
While most people believe that “serious” earthquakes are restricted to California, a report taken by the Center for Earthquake Research and Information states that more than one million earthquakes occur every year throughout the world—or about one every 30 seconds. And, did you know that earthquakes don't just happen along the edges of continental plates? It's true--one of the most violent earthquakes to take place in American history actually occurred along the New Madrid Fault Line, which is located along border where Missouri meets Kentucky and Tennessee.
While it’s nearly impossible to predict when and where disaster will strike, one of the smartest things you can do is to be aware of unexpected possibilities.
Related reading: When Disaster Strikes: What to include in your Emergency Kit
When it comes to Mother Nature, there is very little, if anything, we as humans can do to prevent natural disasters from occurring. The best you can do is be alert, be prepared, and protect your high-risk property with proper and adequate insurance.
If you're interested in obtaining flood insurance quote, call us today at 866-913-5180 or request a quote by leaving a comment below.