If the floodwaters have already breached the Missouri River, or the Mighty Mississippi and that water is coming down your street then it is too late to buy flood insurance. I am often reminded by the famous quote; "When did Noah build the ark? Before the flood, remember?" In other words the time to buy your flood insurance, or make sure you are covered by the National Flood Insurance program is prior to the rainy season, or the severe snowmelt during times of heavy snowpack.
Indeed, when the snowpack is over 100%, and this happens on the West Coast during El Nino seasons, you are likely to find that the nation's flood insurance companies are not very willing to write policies, and remember the rainy season, and the snowpack in that case happen six months prior to the floods, when that snow melts. The same thing happens when buying insurance to protect your home from hurricanes which produce storm surges, or tidal surges.
Many companies will not sell you insurance at or about the time that Hurricane season starts. They want to sell you the insurance after hurricane season, so that you pay into the system for a while, before they wish to be paying out any claims. Likewise, obviously you can't buy earthquake insurance during an earthquake, or exactly afterwards, while there still is a risk of Aftershocks.
As we watched the floods in the spring and summer of 2011 in the Midwest, and along the Mississippi in the South, we felt for all those individuals, and no American wants to see their fellow citizens being flooded out. Of course there's not much you can do for them once the water starts flooding, the levees are breached, or the dams are opened to prevent floodwaters from rising and causing a catastrophe in a city with millions of people in it.
We can't expect insurance companies to sell insurance by the time that the Army Corps of Engineers puts out data in the media that the floods are coming, and chances are they will overflow the banks of these giant rivers. By then it's too late, and insurance companies aren't stupid, they will cut off all insurance policy sales at that point. Remember insurance companies are in business to make money, and they do this by sizing up the risks, and taking that gamble based on probability.
Therefore if there is a high probability of major floodwaters coming, they are not going to put their shareholders at risk, or the insurance company's retained earnings or assets. Indeed I hope you will please consider how the free-market works, and buy your flood insurance long before you might actually needed. Because if you wait, it will be too late.
Lance Winslow is a retired Founder of a Nationwide Franchise Chain, and now runs the Online Think Tank. Lance Winslow believes writing 23,777 articles by 7 PM on June 27, 2011 is going to be difficult because all the letters on his keyboard are now worn off now..
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