Palm Beach County is one of the most hurricane-prone areas of Florida. The county sits to the north of Miami on Florida's Atlantic coast. Its coastline runs from north to south and is exposed to onshore winds as well as storms that commonly track across the Bahamas and make landfall in southern or central Florida. Areas to the east of the Intracoastal Waterway are regularly exposed to high winds, storm surges and flood damage. However, virtually every home in this low-lying county is at some risk for storm-related damage. Even the severe thunderstorms that occur on a weekly basis during the spring and summer months can cause significant damage.
As such, homeowner's insurance is extremely expensive in Palm Beach County. In fact, the area is known for having some of the highest homeowner's insurance rates in the country. Despite recent high-profile hurricane strikes in Louisiana, Texas and the Northeastern Corridor, Florida remains the most storm-prone state in the country.
It's important to remember that homeowner's insurance policies don't cover flood damage. To ensure that you won't have to pay for your home's post-flood repair costs out of your own savings, you'll need to carry a separate flood insurance policy on top of your existing homeowner's insurance policy. In some areas of Palm Beach County, flood insurance is mandatory. Known as "Special Flood Hazard" areas, these places are typically located adjacent to the county's coastline or at particularly low elevations.
In addition, you'll need to purchase separate flood insurance on any home purchased using a federal mortgage loan. You must also take out a flood insurance policy after receiving post-storm federal aid in order to qualify for future disbursements of aid.
Since homeowner's insurance is already extremely expensive in Palm Beach County, you may wish to forgo flood insurance. This may be a wise decision in certain inland areas of the county that are less prone to flooding or water damage.
As Palm Beach County is a large, diverse part of Florida, it's difficult to estimate the "average" cost of obtaining both homeowner's insurance and flood coverage there. If you live in a new house on the beach or near the Intracoastal Waterway, you should assume that your average annual insurance costs will approach 5 percent of the value of your home. If you live inland, these costs may be between 2 and 3 percent of the value of your home.