How Does Disaster Assistance Impact Flood Insurance?

Flooding can be devastating, it destroys properties and lives. However what follows a flood can be even more devastating. Finding resources to help with cleanup and recovery can be challenging. In some situations disaster assistance can be available and we want to talk about that means for you.

Whether you have flood insurance or not disaster assistance can be available. Residents of Muscle Shoals Alabama recently learned about this as they suffered a major flood in low risk areas. So when does disaster assistance become available? Generally disaster assistance comes available to communities and property owners after a presidential disaster declaration. So when these funds are handed out do they have to be paid back? Well when it comes to assistance it could come in two forms either through FEMA disaster assistance grants or SBA loans. Disaster assistance grants do not have to be paid back but what are the implications of accepting them?

When you ask the government for handouts of course it is going to come with conditions and we want to talk about some of those today. First of all this disaster assistance money can only be used for certain things. For example the funds can not be used to cover food losses you have incurred. These funds will not pay to bring your house back to the condition before the flood. Disaster assistance will not cover things that insurance will if you had insurance. It will cover things like temporary housing and emergency home repairs.

So if you accept this disaster assistance for help on your property what is the consequence?  Well if you are in what is called a special flood hazard area or SFHA then it could be required that you always carry flood insurance on the property. This is something to seriously consider because even after you sell the property the new owner will be required to carry flood insurance through the National Flood Insurance Program as long as the property. This something that the seller must disclose to the buyer, so as you can imagine this can make things more difficult when comes to reselling.

So if you have questions about disaster assistance before you apply please visit our website The Flood Insurance Guru, subscribe to our YouTube Channel, or like our Facebook page The Flood Insurance Guru where we do daily flood educational videos.