Your National Flood Insurance Program policy will cover direct physical damage to your home and possessions in the event of a flooding.
What is flood insurance and how does it work?
Flood insurance is usually purchased separately from homeowners insurance and can cover water damage caused by flooding. It may also help protect your house and possessions. Your flood insurance will cover the cost of rebuilding or repairing your home if it is damaged in a flood. It will also pay the cash value for your personal belongings.
What is flood insurance?
Most homeowners’ insurance policies do not cover damage caused by flooding. If you reside in a flood-prone area, you might want to consider purchasing flood insurance through the National Flood Insurance Program or a private insurer.
The National Flood Insurance Program offers coverage of up to $250,000. This includes your home structure, and your personal belongings up to $100,000. You can purchase a policy with a private insurer if you require higher limits due to the high value of your home. Private flood insurance can either replace or supplement your NFIP.
The NFIP covers homes at replacement cost, while personal property is covered for its actual cash value. The NFIP pays you for the value of the items that are covered. It may cost up to $1,000 for a new couch of the same quality as you lost during a flood. If your couch was valued at $600 when the loss occurred, you will receive that amount from the NFIP. Private insurers may offer coverage for your personal belongings at the replacement cost if you opt to purchase flood insurance.
What is covered by my flood insurance policy?
Flood insurance can help you protect your home and valuables. The NFIP provides two types of coverage – building coverage and content coverage – to protect your home. Here are some examples of what is covered by NFIP flood coverage:
Building coverage
- Electrical and plumbing systems
- Furnaces, water heaters
- Built-in appliances such as dishwashers, refrigerators and cooking stoves
- Carpeting that is permanently installed
- Installed cabinets, panels, and permanent bookcases
- Window blinds
- The foundation walls, anchorage system, and staircases.
- Detached garages
- Fuel tanks, well-water tanks and pumps and solar energy equipment
The contents of the article
- Personal belongings (clothing, furniture, electronic equipment, etc)
- Curtains
- Washer and dryer
- Portable and window air conditioners
- Microwave oven
- Carpets that are not covered by the building insurance (e.g. carpets installed over wood floors).
- Valuables like furs and original art (up to $2500)
What’s not covered by flood insurance?
The cause of the flooding is important when determining coverage.
Flood insurance covers direct losses caused by flooding. A flood is a large amount of water that covers land normally dry. It can affect two or three properties or at least two acres.
Damage caused by a sewage backup, for example, is covered when the backup was a direct result from flooding. The damage will not be covered if the sewer backup was not directly caused by flooding.
Have questions about your coverage? Ask your agent what’s covered and what’s not.
Do I need flood Insurance?
If you live in an area with a high risk of flooding, your mortgage lender might require that you purchase a flood insurance policy as a condition for the loan. You are not legally required to buy one if you don’t live in a high-risk area. According to FEMA, an inch of rain can cause up to $25,000 in damage.
Flooding can occur even if you do not live in an area at high risk for flooding. Heavy rains, melting snow and extreme coastal weather conditions may be the cause. Flood insurance can be a good option for homeowners who live near rivers or bodies of water.
Flood damage and renters insurance
Renters’ insurance policies do not cover flood damage. You’ll need to purchase a separate policy of flood insurance in order to protect your property from flood damage. You will only be required to insure your personal property and not your actual home. Your landlord is responsible for insuring the building you live in.
Flood damage and car insurance
Your auto insurance policy could pay for repairs or replacements if you have comprehensive coverage. Typically, a deductible is required.
How much does flood insurance cost?
The NFIP offers flood insurance for around $700 per year. Your rate will vary depending on your risk, just like with any insurance. If you live in an area that is prone to floods or a zone with a high risk of flooding, your rate will be higher. Private flood insurance premiums will be affected by your location (how near is your house to the water? The premiums for private flood insurance companies will vary greatly depending on location (how close is your home to the water’s edge?
How to buy flood insurance
Talk to your insurance agent or company about how you can buy a flood insurance policy. Fassbender Insurance will give you a custom flood policy quote.
