Flood insurance can seem confusing because it goes through the National Flood Insurance Program (NFIP). The Federal Emergency Management Agency (FEMA) determines if an area’s properties require flood insurance. The flood policy you purchase from George Ryan Jr. Insurance Group Inc to insure your Bourbonnais, IL home or business comes through our underwriter. It isn’t federal insurance, but it does go through a national program for approval. Let’s explore why.
For a few centuries, floods wreaked havoc across the United States, damaging rural areas, suburbs, cities, and unincorporated areas. Because urban planning can make no area completely impervious to flood since rains can inundate any location, floods continually cause widespread damage that the government and homeowners treat just like any other natural hazard.
In 1968, Congress passed The National Flood Insurance Act, which created NFIP. The legislation enumerated two goals:
- Reduce future flood damage,
- Protect property owners.
A follow-up law, passed in 1973, The Flood Insurance Protection Act, mandated the purchase of flood insurance for homeowners in high-risk flood zones if the homeowner borrowed from a federally insured financial institution. Today, when you take out a mortgage from a bank that the Federal Deposit Insurance Corporation (FDIC) insures, you must purchase flood insurance if your purchased property lies within a flood zone.
So, when you purchase flood insurance from George Ryan Jr. Insurance Group Inc, you still purchase from us. The insurance policy we provide meets requirements set by NFIP to ensure that your insurance will adequately cover flood damage. When your bank tells you that you must purchase and maintain a flood insurance policy to obtain your mortgage, it says that because FEMA conducted flood studies and determined that the property you bought floods. FEMA illustrates this on flood maps it creates for each locality in the US. The bank has to require this to comply with federal law and meet the burdens of keeping its insurance.
Contact George Ryan Jr. Insurance Group Inc serving Bourbonnais, IL to purchase your flood insurance policy. If you’re unsure if your property requires this type of insurance, we can help you look it up.