Flood insurance, what you need to know to ensure proper coverage

Bob Platin, the owner of Supreme Agency in Bob Platin, the owner of Supreme Agency in Holbrook, with his wife Lori Platin at their Bayport home that was flooded by superstorm Sandy. (Sept. 9, 2013) Photo Credit: Heather Walsh

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Before Sandy hit, many Long Islanders living by the water considered flood insurance an extra expense required by the bank.

These days, making sure you're properly covered with an adequate flood insurance policy, and understanding your homeowner's insurance policy, is as important for hurricane preparedness as making sure you're stocked up on flashlights, batteries and water.

"I think Sandy opened up people's eyes on a lot of things," says Don Caetano, a spokesman for the Federal Emergency Management Agency.

Flood insurance, which is not included in a regular homeowner's insurance policy, is underwritten and subsidized by the federal government under the National Flood Insurance Program. People who live in areas with a high risk of flooding are required to be insured, but homeowners in areas where flooding isn't a regular occurrence can also purchase a policy through a local flood insurance agent. The National Flood Insurance Program has an arrangement with private insurance companies to sell and service flood insurance policies.

CHECK YOUR POLICY

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Caetano recommends that homeowners speak to their agent if they want to find out if they have enough coverage, or if it's a good idea to purchase a policy. A list of local agents can be found at floodsmart.gov. They can also contact their town's floodplain manager or the Nassau or Suffolk County Office of Emergency Management.

"One of the things we encourage everyone to do -- and Sandy was a good example of -- is pick up your insurance policy and read it," Caetano says. "Pick up the phone and call your agent. That's why they're there."

A basic flood policy covers up to $250,000 in damages for a house, and currently premiums can range from $400 to $2,200 per year, depending on where you live.

Bob Platin, the owner of Supreme Agency in Holbrook, knows about flooding all too well. Aside from owning an insurance agency that writes flood insurance policies, Platin just moved back into his Sandy-flooded house in Bayport four weeks ago.

The main thing to know, if you have purchased separate contents coverage, is that flood insurance doesn't cover items in basements, or rooms below grade, except for equipment such as furnaces and hot water heaters. Even a family room a few steps down can be considered below grade. A friend of Platin's redid her kitchen before Sandy, and since it was a little bit below grade, the new appliances were not covered under her policy.

"It can be an inch or two below grade -- they won't cover it," Platin says. "A lot of people have sunken dens. A lot of people got hurt."

There are many changes on the horizon for the program. Last year, Congress passed the Biggert-Waters Flood Insurance Reform Act of 2012. Flood insurance rates are expected to go up an average of 10 percent, and as high as 25 percent for some properties, and homeowners in certain areas will be required over the next year to hire a surveyor to determine the elevation of their homes.

ELEVATION MATTERS

"The elevation of their house will greatly affect how much they're going to pay," says Robert Keeney, president of the W.J. Hofmann Agency in Massapequa.

Keeney recommends that his clients get the survey done as soon as possible. All new applicants in certain zones and renewals of current policies have a year to get the survey done.

"I anticipate there's not going to be enough surveyors on Long Island to do all this paperwork," Keeney says.

Many people whose homes suffered damage from Sandy may have also had a tough time navigating what was covered by their regular homeowner's insurance policies. In general, policies cover damage from wind and wind-driven rain.

"The real kicker here is groundwater," says Brian Gill, an agent with State Farm Insurance in Melville. "If rain hits the ground and flows through your basement, that's not covered by homeowner's insurance. If a tree hits your house and the roof blows off and water comes in, you're covered."

Policies don't cover tree removal, but cover fixing the part of the house or fence that is damaged. If a tree in your yard falls on a neighbor's house, the neighbor's insurance would cover it.

Gill recommends reviewing your policy every couple of years. If you do work to your home, such as putting on an addition, make sure your insurance company knows that. Also, have names of contractors handy before the storm.

"Your relationship is going to get them there faster," Gill says.

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