Kayla Ward was drinking coffee on her porch Friday afternoon when she noticed water levels in the nearby Nolichucky River rising rapidly.
After living in her Appalachian home for almost a year, Ward never thought about flooding. However, after Helen swept through Jonesboro, Tennessee, she and her husband had to flee in a hurry. The couple managed to escape with their pets and clothes on their backs, but their home sustained extensive damage.
Ward, like many other homeowners affected by last week’s storms, said she did not have flood insurance and her insurance company denied her husband’s claim. It came as a surprise to Ward, 61, who worked as a claims specialist at a general insurance agency in neighboring Johnson City.
“I find that everyone in our area feels the same way. No one is covered,” she told USA TODAY. and “We lost everything. Everything.”
Hurricane Helen’s devastating path to the Southeast has put a spotlight on the lack of flood insurance in the United States. FEMA estimates that only 4% of homeowners in the country have insurance.
Protect your home for less: the best home insurance
“The situation is dire in terms of whether insurance money will be flowing to affected households to help pay for repairs,” said Amy Buck, executive director of United Policyholders, a consumer advocacy group. “It’s quite likely that (the homes had flood insurance) it wasn’t enough.”
big insurance gap
Although authorities have not yet released damage estimates, USA TODAY estimates that insured residential and commercial property losses in Florida and Georgia are worth at least $3 billion, according to financial services firm CoreLogic. Then it was reported. This storm was one of the deadliest hurricanes to make landfall in the continental United States, killing more than 100 people, and was also referred to as “Hurricane Katrina” in North Carolina. The damage was estimated at an unadjusted amount of $125 billion. Because of inflation.
But Katrina’s destruction was different. Bach said many people affected by the 2005 storm had their homeowners insurance claims approved because the damage was caused by wind damage. Most of the damage this time was caused by storm surge and flooding.
“We don’t have any wind arguments or hooks to bring home insurance companies in,” she said.
Residents tend not to purchase flood insurance for two reasons: cost and awareness.
Bach said some homeowners don’t know they have to pay for flood insurance separately.
“There is definitely a digital divide,” she says. “Insurance regulators and public officials are always looking for ways to raise consumer awareness about the fact that flood damage is excluded from home insurance, but people don’t want to think about insurance.”
Some people struggle to pay for additional flood insurance or don’t think the cost is worth the compensation. Flood insurance through the National Flood Insurance Program costs about $1,000 a year on average, according to USA TODAY’s Blueprint. And this is on top of traditional homeowners insurance, which saw double-digit growth in 2023, according to S&P Global Market Intelligence.
Tim Zawacki, insurance sector strategist at S&P Global, said insurance prices are expected to continue rising. He expects homeowners insurance companies to reassess their exposures “across a wide range of locations” after Helen hit areas hundreds of miles from the coast.
“As carriers reduce exposure to limit concentration risk and revenue volatility, this will inevitably lead to higher homeowners insurance premiums,” Zawacki said in an email to USA TODAY. ” he said.
Insurance prices: Rising insurance costs are causing more homeowners to go uninsured.
“False sense of security”
Some homeowners like Ward assumed they didn’t need additional flood insurance outside of FEMA-designated flood zones, which require homeowners with mortgages to buy flood insurance.
However, these flood maps are often outdated or incomplete. Only one-third of the nation’s floodplains are mapped by FEMA, according to a 2020 report from the Association of State Floodplain Managers.
“These maps can give people a false sense of security,” said Sharon Cornelissen, director of housing for the Consumer Federation of America. “We know that as climate hazards become more common and rain and storms become more frequent and intense, the actual risk of flooding becomes more widespread.”
Since 1996, 99% of the nation’s counties have been affected by flooding, and FEMA considers flooding to be the most common and costly natural disaster in the country.
“We believe the lack of flood insurance is the biggest insurance gap,” said Mark Friedlander, director of corporate communications for the Insurance Information Institute. “Some (homeowners) are at higher risk than others, but no matter where you live, you can’t say you’re not at risk.”
Next steps for homeowners
For homeowners affected by Helen who don’t have flood insurance, experts who spoke to USA TODAY shared their advice for next steps.
Focus on getting your home dry as quickly as possible, but beware of scammers. There is a shortage of contractors who can help dry your home, so be sure to vet those who offer assistance. Document the damage by taking photos and videos. Check your home policy. Bach said certain costs may be covered to some extent under housing policies, especially if the homeowner can point to wind-driven rain as the cause of the damage. It is worth getting a second opinion before assuming your damages are not covered. Apply for FEMA assistance and check for state or local emergency funding assistance. While FEMA funding may help, Friedlander cautioned that it is not a replacement for insurance. The average FEMA disaster assistance grant amount from 2016 to 2022 was $3,000. In comparison, FEMA warns that even just one inch of water submersion can cause approximately $25,000 in property damage.
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