Flood Insurance

During the 1920’s, in the insurance industry concluded that flood insurance could not be a profitable venture because the only people who would want flood coverage would be those who lived in floodplains.

In 1968, Congress passed the National Flood Insurance Act to correct some of the shortcomings of the traditional flood control and flood relief programs. The act created the National Flood Insurance Program (NFIP) to:

  • Transfer the costs of private property flood losses from the taxpayers to floodplain property owners through flood insurance premiums.
  • Provide floodplain residents and property owners with financial aid after floods, especially smaller floods that do not warrant federal disaster aid.
  • Guide development away from flood hazard areas.
  • Require that new and substantially improved buildings be constructed in ways that would minimize or prevent damage during a flood.

In order for a citizen to be able to purchase flood insurance, the community in which he/she lives must be a participating member of the NFIP. NFIP That is, the community must uphold certain FEMA and County standards and enforce certain building codes that mandate flood safety. Pinal County is a member of the NFIP, so any person in the county is entitled to purchase flood insurance, whether or not they are in a floodplain. If your house is financed by a federally backed mortgage, you are required by law to carry a flood insurance policy. If your house is in a floodplain and you do not have a mortgage, we still recommend that you carry a “preferred risk” policy in the event that if you ever do have any water damage from flooding which is not covered by any other part of your insurance policy, you will have some degree of coverage for flooding. Most flood damage occurs in non-Floodzone 'A' areas, so if you are close to a floodplain, we also recommend carrying flood insurance. It is well worth the cost if your house is ever damaged by floodwaters.  Don't forget contents coverage as well!  This can protect your valuable belonging in the event they are damaged or destroyed due to a flood.

Some More Facts about Flood Insurance:

  • In most cases, there is a 30-day waiting period for coverage to go into effect.  Don't wait until the storms come to get insurance.
  • Homeowners' insurance does not cover flood damage.  You need a separate flood insurance policy
  • Renters can purchase contents-only flood insurance to protect their belongings
  • After a flood, disaster assistance is not always available.  If it is, it is usually in the form of a loan that must be repaid.

For more facts about flood insurance, check out FEMA's booklet: Myths and Facts about the NFIP