Homeowners who don’t have a mortgage on their property could be without flood insurance, covered only through a special policy purchased from the National Flood Insurance Program. Their cars, however, could be covered under a normal auto insurance policy.

With water in certain areas for the first time in a lifetime, people who own flooded-out homes could find themselves without insurance coverage, Mississippi’s insurance commissioner said Wednesday.

“Normal homeowner policies will cover falling rain out of the sky and plumbing leaks,” said Commissioner Mike Chaney. “It will not cover rising water; that means floods.”

“You’ve got to have flood insurance to cover a flood,” said State Farm Insurance agent Robert Pannell.

It’s not a matter of checking your insurance policy to see if it contains a flood rider. You can only buy flood insurance from the National Flood Insurance Program (NFIP), which is run by the federal government.

“I’ve been proactive on this, suggesting people look at their policies and try to buy flood insurance if they can afford it,” Chaney said. “That may happen if you’re close to a river, but if you’re in a low-lying area and it’s never flooded in your lifetime, you’re going to wonder, ‘Why do I need flood insurance?’ But floods can occur almost anywhere.”

Pannell said if a homeowner has a home mortgage and the house is within a flood plain, his banker or mortgage company will require flood insurance. If a homeowner doesn’t have a mortgage, it will be up to the homeowner to apply for flood insurance, which usually can be done through an insurance agent.

The federal government became the insurer of last resort for flood insurance after several companies were bankrupted by claims after widespread flooding along the Mississippi River. Recent hurricanes, from Katrina to the present, drained the NFIP coffers, forcing the feds to tack on yearly premium increases of 8 percent to 12 percent for policyholders.

Chaney said he has been among the biggest advocates for a plan to reintroduce private companies to the flood insurance business, after homeowners along the Gulf Coast saw premiums skyrocket above $20,000 a year.

“We’ve lobbied Congress to give us the ability to offer private flood insurance that will be acceptable to the bankers and mortgage companies that will be equivalent to the National Flood Insurance Program,” he said.

Only in the past couple of weeks has the U.S. Treasury Department backed the idea to allow private flood insurance in lieu of NFIP to protect mortgages. That won’t help people in floodwater in the Delta right now but should come online in the next month or so, according to Chaney.

In the meantime, the Insurance Commissioner’s Office suggests some safety measures to protect people in flood areas, such as “turn around, don’t drown,” when people come across flooded roads.

“The same thing applies on a home,” Chaney said. “Don’t try to go back in to save something once the water’s risen up in a home or dwelling. Get out and stay out to protect yourself.”

Chaney did say there is hope for victims of the flood if the Federal Emergency Management Agency (FEMA) declares flooded counties as disasters. In that case, low-interest loans and grants could be made available to help recover from the flood. Chaney recommends people take photos of the damage to their homes to aid in submitting applications for FEMA aid, if it becomes available.

Andy Case of the Insurance Commissioner’s Office said the Mississippi Emergency Management Agency has been in touch with county directors and visited flooded areas to compile an assessment of the impact of flooding. A formula is used that takes into consideration damage on a per capita basis to determine if a county meets the threshold for FEMA aid.

If it does, Case said, FEMA will come into a community and set up a local disaster recovery center where applications for assistance will be considered.

“FEMA only pays for what they term the elements of necessary living,” Case said. That means what people need to get back into their house.

While victims might not have insurance to cover flood damage to their homes, they probably have it to cover their cars and trucks, Pannell said. If victims have a car loan, they will have insurance that covers flood damage to their vehicle. Even those without a loan will be covered if their insurance policy includes more than just the required liability insurance, he said.

•Contact Gavin Maliska at 581-7235 or gmaliska@gwcommonwealth.com.

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