Flooding is a risk to any business, whether you are inland or near the coastline. One in four businesses that shut down from a natural disaster never reopens, and more than 80 percent of all presidentially declared natural disasters involve flooding. According to the U.S. government, the average commercial flood claim in the past ten years has been around $33,000. In addition, property damage due to flooding usually adds up to more than $6 billion annually. 

Floods have many causes and can occur anywhere in the country, but here are some of the most common events that lead to flooding:

• Storm surges in hurricane-prone areas.
• Flash flooding caused by periods of intense rainfall.
• Mudslides caused by prolonged, heavy rain periods on a hill or mountainside.
• Snowmelt caused by the still-frozen ground being unable to absorb excess water.
• Ice jams when an ice chunk flows in a river or stream blocks dams or narrow passageways, causing an overflow.
• Urban development, such as new construction or ground paving, alters the topography by not allowing the land to drain correctly. 

You should be aware that a general policy will not cover flood damage; this type of insurance is only available through the National Flood Insurance Program (NFIP). The NFIP will cover all the types of floods discussed above, including mudslides, though it is important to note that it does not cover landslides even if they are caused by heavy rain. To ensure you get a fair price, every commercial flood agent answers to this government agency; therefore, flood insurance is backed by the government but sold through private insurers. 

Commercial contents:

Commercial contents cover inventory, merchandise, machinery, and any other contents your business has up to $500,000.

Commercial building:

Commercial building covers your company’s building up to $500,000. So even if your company does not own the building, you can insure the value of the improvements you made to the space. 

If the value of your business is more than $500,000 in either of these areas, you can purchase an excess flood policy to provide coverage of up to $1 million. In addition to these two types of building coverage, the NFIP will keep you covered for flood protection, prevention, and cleanup.

Connect with us to know more about commercial flood insurance.

Most commercial property insurance policies don’t cover flood damage. So, you may want to buy commercial flood insurance to help protect your business and personal property. Even if your business isn’t in an area prone to flooding, you’ll want commercial flood insurance if:

You run your business in an area with cold, snowy winters and warm springs. Fast-melting snow is one of the top causes of commercial flooding. In addition, you experience moderate rainfall in the spring.

A nearby stream overflows from the rainfall, flowing into your place of business and causing flood damage.

Your business’ basement floods from construction runoff next to your building and damages equipment and inventory.