Catastrophic flooding caused by Hurricane Harvey in Houston last month has left behind a tragic tale of destruction. The city is battling to limp back to normalcy after it was hit by Harvey, a category four Hurricane on the 27th of August. Heavy, record breaking rains lashed the city leading to at least 33 deaths. Thousands of people took to emergency shelters to save their lives.

Residents who have lived in Houston for decades say they have never experienced anything like this before. They were under the belief that they will not be hit by a flood as their homes are located outside a flood zone. Victims now feel cheated as their home insurance policies are proving to be insufficient to get compensations for damages caused by this devastating flood.

Floods caused by Harvey prove that living outside a flood zone is no guarantee of being safe from floods. Some percentage of homes ravaged by floods every year belongs to those not situated in a flood zone. In this instance also, homeowners not having insurance against floods are lamenting the lack of compensation from their insurance companies.

Flood insurance policies are sold by NFIP that has the financial backing of the federal government. With flood zones having been mapped, insurance premium depends on which category of flood zone your home is situated in. These maps are being changed in the wake of recent instances of flooding. Many homeowners are suddenly realizing their homes are now included in a flood zone whereas they lied outside flood zone earlier. Another blow has come from FEMA that has started to phase out subsidies to homes constructed in flood prone areas after the passage of Biggert Waters Act of 2012. This has led to insurance companies increasing their premiums for insurance policies with protection against floods.

In such a scenario, homeowners are turning to private insurance companies that are providing coverage against flooding. Private Flood Insurance is backed by Surplus Lines insurance Companies. Even though it is not covered by PA Property and Casualty Guaranty Association and also not licensed by PA Insurance Department, it does not have an impact on the financial strength of the company.  This private insurance is available at much lower rates than government insurance companies. One of the biggest private insurance companies operating in Pennsylvania is Lloyd’s of London. This has been confirmed by a press release from PA Insurance Department.