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Fire & Water - Cleanup & Restoration

3 Situations Where You Need Commercial Flood Insurance

4/13/2020 (Permalink)

Flood insurance form on a table with a book. Flood insurance can be useful for your Woburn, MA, establishment

3 Situations Where You Need Commercial Flood Insurance

If you own a commercial location, you are likely aware of the inherent damage risks. Since extreme weather is one of those hazards, you will need insurance plans that incorporate emergency damage restoration. Some coverages are not included in commercial insurance, so you may need additional products such as flood insurance, especially in certain situations:

1. Federal Law Requires It
While flood-specific insurance tends to be optional, there are circumstances where you must obtain it. You will need a coverage plan if your business is in a location known as a flood zone or an area that is prone to flooding. These regions are either coastal locations or near bodies of water. Additionally, the building must be mortgaged by a lender that is regulated or insured by the federal government.

2. Your Business Resides in a High-Risk Area
Even if you have no mortgage with a federally regulated lender, it is still a solid strategy to purchase a specialized insurance plan to deal with potential floods whether you are in a flood zone or in a low-to-moderate risk area. Flood insurance is not provided by the Federal Emergency Management Agency, which focuses mostly on residential properties instead of businesses. However, the federal government's national program can help you obtain a viable plan in case the unthinkable occurs.

3. Your Flood Zone May Shift
The safety established by a flood map's designation is not permanent. Factors such as climate change alter these flood zones. Your business may be in a high-risk zone even if your published map does not show it. The proper insurance covers your property in case your situation changes. In addition, if you buy a plan before the location becomes a flood zone, the premium is based on the previous classification, which is comparatively low.
When it comes to business ownership, it is better to prepare for the worst-case scenarios. Flood insurance can be useful for your Woburn, MA, establishment during most situations, especially when flood risks are high.

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