It is estimated that upwards of 40 million properties have moderate to severe flood risk, said a panelist during the #BackToFloodSchool Twitter chat. (Credit: Robert Kneschke/Shutterstock.com) It is estimated that upwards of 40 million properties have moderate to severe flood risk, said a panelist during the #BackToFloodSchool Twitter chat. (Credit: Robert Kneschke/Shutterstock.com)

"If it rains, it can flood."

It was a sentiment expressed several times during PropertyCasualty360.com's Twitter chat, "Back to School: Educating Your Clients on Flood Insurance," which featured industry professionals offering advice on how to guide customers through the often overwhelming maze of information that accompanies the acquisition of flood insurance. The chat covered subjects from national trends for flood claims and flood prevention year-round to NFIP coverage and helpful resources.

"According to FEMA, the average flood insurance claim is $43,000," said Amanda Bryant, director of operations for National Flood Insurance LLC. "Meanwhile, the average cost of a FEMA flood insurance policy is $700 & many private carriers offer even lower rates. Would you rather pay $43k for flood damage or a few hundred dollars per year for flood protection?"

The panel also addressed common misconceptions homeowners have when it comes to flood insurance.

"The most common mistake is believing [flood] is covered by the HO policy – it is not!" asserted Don Griffin, department vice president of policy, research & international for APCIA. "Make sure the limit for the building is enough & purchase contents protection. Remember: backup of sewers or drains & household plumbing issues are not covered by flood insurance."

Another error homeowners make is not realizing how many options are available to them for coverage.

"While the NFIP is still the 'gold standard' when it comes to flood coverage, there are several high-quality private market companies offering flood coverage," said Brian Bowerman, Westfield Services leader at Westfield Insurance. "Your local agent can usually advise but you should search the market and compare options."

Even so, it's important for homeowners to know just what is covered in their chosen insurance plan — and what isn't covered.

"NFIP does not cover basement improvements, personal belongings such as furniture, structural elements, essential equipment, cleanup costs, or additional living expenses," explained Dr, Michel Leonard, chief economist at Triple-I. "Some of these exclusions can be covered in the private market."

Christine Barlow, managing editor for PropertyCasualty360 sister publication FC&S Expert Coverage Interpretation, pointed out that flood often occurs where clients might least expect it.

"Wildfires also lead to floods; burn scars make the ground so hard water doesn't absorb, so then floods result," she said.

Ultimately, as recent events dramatically illustrated, sleeping on flood insurance is not a viable option, the panel agreed. Leonard called attention to a Wharton School study that showed only 30 percent of homes in the highest flood risk areas had flood coverage.

"People always assume it won't happen to them," said Barlow.

See highlights from the conversation below. You can also get a full recap here and continue the conversation on Twitter by using the hashtag #BackToFloodSchool.

Related: Blunt talk: A Twitter chat on commercial auto risks for cannabis businesses

 

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