You’ve probably heard this horror story before – someone loses a home to a flood and finds out that standard homeowner’s insurance doesn’t cover flood damage.
At Point Insurance, we want you to be retrained All the risks you may face – before a loss occurs – so you can decide which insurance cover is appropriate. Spring is a prime season for flooding, so now is a great time to review your options.
Because only a few companies offer flood insurance, the U.S. government created the National Flood Insurance Program (NFIP) in 1968. This insurance, which is available to homeowners, renters, and business owners, is often required to obtain a mortgage in areas at high risk of flooding.
But you might want to look into a policy just for peace of mind, even if you don̵7;t live in a flood zone. According to the NFIP, nearly 25% of the program’s claims occur in moderate-to-low-risk areas. Check out the questions and answers below to determine if flood insurance is right for you.
Is there flood insurance in my area?
To participate in the NFIP, a community must adopt and enforce a floodplain management ordinance with rules governing construction in certain flood-prone areas. In return, the government makes flood insurance available within that community. We are happy to help you determine if you are eligible for flood insurance. Just call us at 833.280.6080. You can also visit http://www.fema.gov/fema/csb.shtm.
What does it cover?
The NFIP provides coverage for both the structure and its contents. However, contents coverage is sometimes optional, so call us to discuss other coverage for your personal property.
Remember, you usually can’t buy flood insurance and have it take effect the next day. Instead, there is usually a 30-day waiting period. (Exceptions to this rule do apply, however, especially when the insurance is required by a lender and purchased at the same time as securing a mortgage.) So if you need flood insurance, don’t wait to buy a policy!
What not does it cover
Generally, government-issued flood insurance does not cover the following: Buildings entirely above water or mainly below ground, gas and liquid storage tanks, animals, aircraft, wharves, piers, bulkheads, growing crops, brush, land, roads, machinery or equipment in the open and those most motor vehicles.
How much does it cost?
As with all insurance, flood insurance costs vary depending on your situation. If your home or business is in a high risk area, such as a ‘special flood risk area’, your premium will naturally be higher than in low or medium risk zones. The premiums are based on how old the building is, how many floors it has, where the contents are, your deductible and more. Renters insurance is usually cheaper, as renters generally insure their belongings, not the building.
Where can I find more information?
As always, we are happy to help you determine your insurance needs. Please stop by our office at any of our offices or call us at 833.280.6080. The NFIP website, at http://www.fema.gov/national-flood-insurance-program, also has lots of answers.