Less than 10% of $30 billion damage from Harvey covered by private insurance, experts say

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by John Chapman

When the cost of damage from Hurricane Harvey is added up, the total could amount to more than $30 billion, according to preliminary estimates. However, experts say that only about 10% of that damage will be covered by insurance, and that the federal government may end up paying the most to rebuild Houston, Corpus Christi, and other areas of southeastern Texas damaged in the storm.

Many homeowners’ insurance policies cover damage caused by wind and certain types of water damage, such as damage from storm surges or wind-driven rain. But for most homeowners, damage caused by flooding is not covered unless they purchased a separate flood insurance policy through the National Flood Insurance Program.

Insurance experts say that most homeowners in the areas of Texas that were most heavily damaged by flooding from Hurricane Harvey do not have flood insurance on their homes. Although laws require homeowners living within 100-year flood zones to care flood insurance, many do not purchase insurance through the National Flood Insurance Program or allow their policies to lapse by not making their payments. As a result, experts say, only about $1.5 billion to $3 billion of the estimated $30 billion in damage caused by Hurricane Harvey will be covered by homeowners’ insurance policies.

However, even homeowners living outside the 100-year floodplain – and who were not required to purchase flood insurance – have been affected by flooding caused by Hurricane Harvey. Although the 100-year floodplain map provides an accurate guide of where rivers may overflow or storm surges may hit, Hurricane Harvey overwhelmed the drainage systems in many areas of southeast Texas affected by the storm. As a result, many homeowners who never expected their properties to flood are now dealing with costly water damage caused by the hurricane.

Although Houston authorities and FEMA officials tried to get more Houston- and Harris Country-area residents within the 30 year floodplain to purchase flood insurance, many homeowners declined to purchase the additional coverage. After the record rainfall and flooding that resulted from Hurricane Harvey, many of these homeowners are now trying to figure out how to rebuild their homes and property without full coverage of the damage under their home insurance policies.

The National Flood Insurance Program was created by the federal government in 1968 after many insurance companies stopped writing flood insurance policies because they could not charge premium payments that were high enough to cover the potential catastrophic damage caused by a major flood. Although the program has helped fill the gap left by the shortage of private flood insurance coverage, NFIP flood insurance limits claims to $250,000 per home, $100,000 for property inside the home, and $500,000 business buildings and their contents. For many home and business owners, these coverage limits mean that federal flood insurance will not fully cover damage caused by Hurricane Harvey.

Water Damage Insurance Lawsuits Filed by Heygood, Orr & Pearson

Homeowners and business owners who believe they were treated unfairly by an insurance company regarding water damage to their home, business, or other property may be eligible to file a lawsuit and seek compensation. The first step in taking legal action is to consult with a law firm whose attorneys have the experience with water damage and insurance litigation advise you regarding your legal rights.

When an insurance company fails to treat home and business owners fairly by denying legitimate claims that should be paid, the lawyers at Heygood, Orr & Pearson are willing to take them on, expose their wrongful actions, and make them pay for their improper conduct. Our law firm has handled hundreds of commercial and insurance litigation claims, including cases involving water damages to homes or other property.

Heygood, Orr & Pearson has the financial resources to handle bad faith insurance claims from start to finish. In many instances, our law firm has invested hundreds of thousands of dollars in order to take a case to trial on behalf of our clients. At Heygood, Orr & Pearson, we are committed to achieving justice for our clients, whatever the cost.

For more information about filing a lawsuit regarding water damage claims that were wrongfully denied by your insurance company, contact the lawyers at Heygood, Orr & Pearson by calling toll-free at 1-877-446-9001. You can also reach us by following the link to our free case evaluation form and answering a few brief questions about your case to get started.