Does Your Business Insurance Cover Floods?

Following the 2005 hurricanes that rocked Louisiana, the 2004 Indian Ocean Tsunami, and the tsunami in Japan, many businesses shut down because of flood damage. Of course, they might not have had to, had they had better insurance.

Some of these business owners thought that they did have coverage, but were devastated to find out that the premiums they had been paying for years did not cover floods.

As climate change begins to cause even more floods, hurricanes, monsoons, and severe storms, flood insurance will become more and more important. Don’t get left out in the rain.

Typical commercial property policies do not cover floods

In fact, they have a clause written right in that says they will not cover any water damage from the following:

  • Flood, waves, overflow, ocean spray, tidal water
  • Sewers, drains, pumps, or pipes
  • Water below the ground’s surface or which seeps, flows, or leaks upwards and into the structure

It does not matter whether this damage is an act of man, nature, or god.

For flood coverage, you must purchase a separate flood policy

Most insurance providers do not like providing flood insurance, so very few do; there are so many factors that go into evaluating risk that it is nigh on impossible to determine what premium to charge for coverage. However, use the quotes on this site and you might be able to find flood coverage at a good price.

Since flood coverage is so essential, the federal government created a program through FEMA to help people become insured. The National Flood Insurance Program (NFIP) provides some valuable information about floods, flood insurance, and business. Not only can you learn how to assess risk there, but you can even get a good idea of what premiums should be. Once you have a good idea, you should use online quotes to find the lowest rates.

A Little Bit Makes a Difference

It only takes an inch or two of water to cause thousands of dollars of damage and potentially shut down a business without insurance.

Think of all the ways your business could get flooded:

  • Burst pipes
  • Broken dams
  • Heavy rainfall
  • Storms
  • Tsunamis
  • Flash floods
  • Upwelling
  • Leaks
  • Human error

Even something as tiny as an employee leaving a faucet running could mean everything.
At the same time, such a small thing as an insurance policy can have a huge impact. Rather than being crushed, you are reimbursed for your essential equipment and operations. With any luck, you won’t need too much coverage and can get coverage for only a little bit of money each month.

Typical Flood Business Insurance Costs

Flood coverage is one of the more expensive business insurances for a small business. Because even $500,000 of coverage can cost up to $3,000 per month, it is a decision you should weigh for a while. However, if you are in a high-risk area, it is really an essential precaution. Imagine putting in so much hard work and money into your business only to see it all float away. That’s what floods can do.

Fortunately, with business insurance quotes, you can find a cheaper policy online in minutes.

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