Closing the Gap in New Hampshire’s Flood Insurance Coverage

By D.J. Bettencourt and Joan Pageau
As Granite Staters continue to struggle with the catastrophic floods of the past few weeks, this incredibly sad event highlights the importance of improving our overall flood preparedness. From our perspective, a critical first step is to understand and appreciate the importance and value of flood insurance. After all, according to the New Hampshire Department of Environmental Services, flooding is New Hampshire’s most common and costly natural disaster.

By most estimates, fewer than 35% of New Hampshire property owners buy flood insurance. We understand that there are several misconceptions that have resulted in so few people having adequate flood insurance coverage. For example, some people feel a false sense of security because they live on property they have always considered to be “high and dry.” Unfortunately, as recent storms demonstrated in both New Hampshire and Vermont, even those who thought they would never be impacted by flooding were left lacking coverage they desperately need.

Everyone in New Hampshire lives in an area with some flood risk. Therefore, the question to consider is not “Are you at risk?” but rather “What degree of risk does your neighborhood have?” Remember, anyone, including renters, can buy flood insurance, and you do not need to be in a designated floodplain to get coverage.

Most people assume that their home insurance covers any flood damage they might have, but it does not – It is critical to appreciate that homeowners insurance almost never covers flood damage. Without a separate flood policy, any damage resulting from flooding or flood-related erosion caused by waves or currents accompanied by a severe storm, a flash flood, an abnormal tide surge, or something similar, will not be covered.

Flood coverage can pay for the cost of damages done to your physical property. Consumers can usually expect coverage for a home’s structure and systems, such as mechanical, electric, plumbing, heating, boilers, and air conditioning. It also typically covers permanent appliances, flooring, permanent shelves and cabinets.

But what about the cost? According to Insurify, the average cost of flood insurance in New Hampshire is $1,098 per year. That breaks down to about $92 a month. If the price seems high, consider that according to the Federal Emergency Management Agency (FEMA), as little as one inch of floodwater can cause up to $25,000 in damage. An even more difficult question to consider is: if your home was completely lost in a flood, would you have the financial resources to replace everything you would lose.

To ensure that you have access to the most affordable coverage possible, we encourage you to shop around to get the best value. New Hampshire property owners have two options to buy flood insurance coverage: a policy through FEMA ’s National Flood Insurance Program (NFIP), or from a private insurance company. Though NFIP is a government-backed option to buy coverage, NFIP works with participating insurance companies that sell and manage policies. A local independent insurance agent can help you navigate the process and find you the most appropriate coverage.

While the current storms may not have affected the entire state, this does not mean that the next storm will not impact you. Inherent in our “Live Free or Die” culture is the reality that living in New Hampshire carries a responsibility: you are your own first line of self-defense. Take the appropriate time to work with your insurance company or an independent insurance agent to ensure you have appropriate flood insurance coverage.

— D.J. Bettencourt is the Deputy Commissioner of the New Hampshire Insurance Department; Joan Pageau is the President of the NH Association of Insurance Agents