Did you know that as many as 90% of natural disasters that occur in the US, involve some kind of flooding? And did you also know that as much as 20% of that flooding often hits areas that are only classed as being of low or moderate flood risk?
While it’s nobody’s intention to worry you unnecessarily if you’re a homeowner in the US, it’s important to understand that homeowner’s insurance policies don’t cover flooding in their standard policies, and if you want to make sure that your home is protected against an eventuality such as a flood, you should learn more about flood insurance protections
The basics of flood insurance:
- Floods are not covered under homeowners and renters’ policies. Only if you have purchased a specific flood insurance policy will your home be covered against any losses incurred due to the unfortunate event of a flood.
- Most flood insurance is administered by the federal government. Under a contract known as FEMA, homeowners and renters can purchase flood coverage from an insurer, whereas federal flood insurance is available in those areas in which the local government has adopted flood plain management regulations under the NFIP; there are many communities who take part in this program.
- Direct physical losses from floods and flood related erosion are covered in a flood insurance policy. Flood related erosion can be that such as is caused by waves or currents of water exceeding their usual cyclical levels, and which may be accompanied by a severe storm, a flash flood, or an abnormal tidal surge.
- To cover the structure and contents of your home, you must buy two separate policies. Your home itself (the building), is covered for replacement cost, but coverage for personal property is only made available on an actual cash basis.
- Coverage amount for the structure of a home is a maximum of $250,000, and $10,000 for the contents. Private insurers offer excess coverage that goes over and beyond the maximums available through a government insurance policy.
- Flood coverage for cars is not included. A standard automobile insurance policy will provide coverage for a car under its optional, comprehensive portion.
What happens if there’s a flood and I haven’t got adequate (if any) coverage?
Unfortunately, if you’re the victim of flooding and your home and/or its contents are damaged or destroyed as a result ad you don’t have a flood insurance policy, then you would probably need a loan to cover those costs. In some communities, and depending upon the severity of the flood, the federal government may make a low-interest loan available as part of a relief package, but of course it needs to be paid back.
There really is only one way to ensure that you don’t lose money if your home gets flooded, and that’s by purchasing a flood insurance policy. To make sure your home is covered should you fall victim to a flood, talk to a professional, private insurance company today.