Did you know? Just a single inch of water from flooding can cause costly damage to your home. Here’s what you need to know about insuring against damages caused by a flood.
What Does Flood Insurance Cover?
A standard homeowner’s policy does not cover damages from flooding (learn more about homeowner’s insurance here). A separate flood policy is needed to covers losses to your property caused by flooding. Flood Insurance provides coverage for:
- Structural damage
- Furnace, water heater and air conditioner
- Flood debris clean up
- Floor surfaces (carpeting and tile)
You can also purchase a flood insurance policy to cover the contents of your home, such as furniture, collectibles, clothing, jewelry and artwork.
According to the Federal Emergency Management Agency (FEMA), flooding is the nation’s most common natural disaster. 25% of flood claims are filed by people living in moderate-to-low risk areas. Floodwaters have the power to damage not only your home and sense of security, but also your financial future. How can you protect your most important investment? What are your flood options? We’ll go into the options right now.
Hope that you’ll receive federal disaster assistance if a flood hits.
Many people wrongly believe that the U.S. government will take care of all the financial needs of their home and family if they suffer damage due to flooding. However, the truth is that federal disaster assistance is only available if the president formally declares a disaster. Even if you do get disaster assistance, the assistance is usually a loan that you have to repay, with interest, in addition to mortgage loan that you still owe on the damaged property.
Most importantly, you must consider the fact that if your home is flooded and disaster assistance isn’t offered, you’ll have to shoulder the massive damage costs alone. What will you do if that happens?
If you’re looking for secure protection from financial loss due to flood damage, federal disaster assistance is not the answer. That’s the bottom line.
Buy flood insurance and stay protected.
When disaster strikes, flood insurance policyholder claims are paid even if a disaster is not federally declared. Flood insurance means you’ll be reimbursed for all of your covered losses. Additionally, unlike federal aid, Flood Insurance never has to be repaid.
Does your community participate in NFIP? As long as your community participates in the National Flood Insurance Program (NFIP), you are eligible to purchase flood insurance. Friedle Insurance Agency can assist you in determining if your community participates in the NFIP.
As a homeowner, you can insure your home up to $250,000 and its contents up to $100,000. If you are a renter, you can cover your belongings up to $100,000. As a non-residential property owner, you can insure your building and its contents up to $500,000.
In general, a policy does not take effect until 30 days after you purchase flood insurance. For example, if the weather forecast announces a flood alert for your area and you want to purchase coverage, it’s already too late. You will not be insured if you buy a policy a few days before a flood. However, if your lender requires flood insurance in connection with the making, increasing, extending or renewing of your loan, there is no waiting period.
An item to note: Not all water losses are considered flood damage.
For your losses to be covered under a flood insurance policy, the following definition of a “flood” applies:
A general and temporary condition of partial or complete inundation of two or more acres of normally dry land area or of two or more properties (at least one of which is your property) from: overflow of inland or tidal waters; and unusual and rapid accumulation.