Flood insurance is basically a type of insurance coverage in preparation for any loss of property from flooding. Insurance companies make use of topographical maps that mark floodplains and lowlands susceptible to flooding to find out what risk factors can cause damage or loss of specific properties. In the United States, insurers do not furnish this coverage due to the flood hazard’s confinement to a few places or areas. In 1968, Nat’l Flood Insurance Program was created by the federal government to respond to the increasing cost of the disaster relief for the victims of flood that are taxpayer funded.
US Federal Flood Insurance is designed for providing an insurance that is alternative to for disaster assistance to cover the ever rising expenses of repairing damaged buildings and their contents as the flood’s effects. There have been around 5.5 million houses insured by this federal program since April 2010. The majority of this large number of homes was in Florida and Texas. In a more basic sense, flood insurance is made available by the federal government within a community with high flood susceptibility level as a financial preparation or protection against flood property losses.
This flood insurance mechanism requires a premium which is paid for the protection. The National Flood Insurance Program underwent three different amendments. There are several criticisms thrown at the federal government regarding this program. Based on the prediction of critics, this program tended to encourage people to locate themselves in some areas of the United States which are even more susceptible to destructive flooding. If a property owner has their property insured, they will receive disaster support and payment. Thus, in spite of all the criticisms raised against the program, many US citizens still believe in the benefits they can possibly get out of it.
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