Why Flood Insurance is Crucial For Your Credit Union

By Michael McKinley

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After natural disasters like hurricanes and other major storms, flooding for homeowners is a much-discussed topic. What we rarely hear about is how important flood insurance is for businesses, especially credit unions in hard-hit areas.

Flooding is the most common and costly natural disaster in the United States. It’s more widespread than you may think: 98% of U.S. counties have experienced a flooding event, and just one inch of water in a home can cause more than $25,000 in damage.

Unfortunately, most business owners, homeowners and renters typically don’t buy flood insurance, even though damage is often excluded from traditional property and contents coverage. 

The biggest thing credit unions can do is to be as prepared as possible with a flood (or overall disaster) plan. Most credit unions don’t have a detailed enough plan, and if they have one, it’s often not reviewed or updated regularly. 

Not only should credit unions protect their brick-and-mortar buildings, they also need to make sure they can continually serve their members during a crisis. These plans should include required safety precautions, plus identify immediate service needs. This might include electronic systems for online banking, ATM coverage and loan approval arrangements. 

Your members will be counting on their credit union to help get their lives back together, and you can help make sure that process is as seamless as possible.

More Than a Plan 

But you can’t stop there. Credit unions can’t just have a plan, they must update them regularly. Continually look for gaps and ways to improve them. These plans need to be part of your business’s culture. When new items and processes are added, and on a regular basis, you must test your plan to make sure everything runs smoothly. You’ll want to identify weak spots before a crisis or disaster occurs.

The good news is, you don’t have to do this work on your own. CUNA Mutual Group works with credit unions to make this a little easier. We can help when a disaster is imminent and add to preparations. Then, if a loss occurs, we work directly with vendors and experts to get boots on the ground, usually within 24 hours. 

With all of this in mind, I always go back to an insurance “motto” of sorts: You can’t control the weather, but you can prepare for it. Create a plan, test it and continually improve service to your members. 

For more information on how to help protect yourself and your members against flood damage, visit: https://www.cunamutual.com/flood.

Michael McKinley is with CUNA Mutual Group. 

 

Section: Standard
Word Count: 584
Copyright Holder: CUToday.info
Copyright Year: 2018
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URL: http://www.cutoday.info/THE-tude/Why-Flood-Insurance-is-Crucial-For-Your-Credit-Union