According to the Federal Emergency Management Agency (FEMA), flooding is the #1 natural disaster in the United States. It is the most common and costly natural disaster and cause millions of dollars in damage every year. On average, floods cost the U.S. $8.2 billion yearly in damages. Flooding can be caused by storms, hurricanes, dams or levees breaking, new development changing how water flows above and below ground, snowmelt and much more.
FACT: Most homeowners and renters insurance policies do not cover flood damages.
Therefore, it is an important policy to consider to further protect your home from further loss. Just one inch of water in a home can cost more than $25,000 in damage.
FACT: Coverage for your building and contents are purchased separately.
Building coverage only covers the structural components, such as the building itself, electric and plumbing systems, water heaters, furnaces and more. You will need to purchase contents coverage separately for the items inside your property.This includes personal items such as clothing, furniture, electronic equipment, clothing washer and dryers, portable and window air conditioners and more.
Please feel free to speak to your insurance agent about what is and isn’t covered in your policy.
Deductibles apply separately to building and contents with different amounts to choose. As with other insurance plans, a higher deductible will lower the premium you pay but will also reduce your claim payment, meaning you will need to cover the difference out of your own pocket. Sometimes a mortgage lender will set a maximum amount for your deductible.
Typically, there’s a 30-day waiting period from date of purchase until your policy goes into effect.
Here are the exceptions:
- If the building is newly designated in the high-risk Special Flood Hazard Area (SFHA) and you purchase flood insurance coverage for it within the 13-month period following a map revision, there is a 1-day waiting period.
- If you purchase flood insurance in connection with making, increasing, extending, or renewing your mortgage loan, there is no waiting period.
- If you select additional insurance as an option on your insurance policy renewal bill, there is no waiting period.
Your insurance agent may ask you for an Elevation Certificate. This certificate verifies your building’s elevation compared to the estimated height floodwaters will reach in a major flood in a high-risk flood area. This certificate will not negatively effect your premium. Instead it may help qualify you for a discount on your flood policy if you are in a low risk flood zone.