Risks of Owning a Business in a Floodplain Zone

10/9/2023 (Permalink)

Depending on the location, a floodplain can be a minor component of a landscape or the primary feature.

Floodplain zones help builders and business owners determine the level of risk associated with building in or inhabiting areas near a waterway (lake, river, stream, creek). Insurance agents use flood maps to identify the zones, which guide them in determining flood insurance requirements and coverage costs.

You can experience a devastating flood event, even if you live in a low-risk zone. Whether you live in a high- or low-risk floodplain zone, purchasing flood insurance is crucial to protect against financial losses resulting from floods, even if not required. Even a couple of inches of water can lead to several thousand or tens of thousands of dollars of damage.

If you choose to have your business in a floodplain zone, there are some important considerations to make:

• Purchase appropriate flood insurance (even if you aren’t required to by law).
• Use flood-resistant building materials in the home, such as laying tile instead of carpet, especially in the basement.
• Install flood vents, which allow the waters to flow through the vents and drain out.
• Elevate your property so the lowest floor is higher than the flood elevation level as identified on the flood map.
• Store belongings that would be adversely affected by water in a high location or a waterproof box to keep them safe from floodwaters.
• Have a plan in place for water damage restoration that you can utilize immediately following a flood event. Addressing water damage right away (within 24-48 hours) minimizes damage and avoids common post-flood problems like mold growth.