It’s the first day of Spring and here in New Jersey we’re expecting a balmy 50 degrees Fahrenheit. Rising temperatures + snowmelt = flooding.
NOAA’s Spring Outlook calls for moderate to major flooding in northern North Dakota and in the Snake River basin in Idaho and flags California, which saw extensive flooding in February, as susceptible to additional flooding in the coming weeks.
Which brings us to this:
Many homeowners incorrectly believe that flooding is covered by standard homeowners insurance, according to the I.I.I. Consumer Insurance Survey.
In fact, flood insurance is available from FEMA’s National Flood Insurance Program (NFIP) and a few private insurance companies.
How to change the misperception?
Part of the answer lies in education, as the I.I.I. says:
“Consumers can—and should—educate themselves about their coverage, recognize that they may have gaps in their coverage and seek guidance from an insurance professional when they purchase or renew a policy.”
The other part of the challenge, as outlined by Wharton professor Howard Kunreuther in an issue brief, lies in how to communicate to people that the best return on an insurance policy is no return at all.
“In reality, insurance is a protective measure should one suffer a loss. Homeowners should celebrate not having a loss because the financial consequences for an uninsured individual could be staggering.”
What do you think?