What Kind of Insurance Do You Need If You live in A Flood Zone?
Floods are one of the most common natural occurring disasters. However, the damages caused by it are not covered under standard renters and homeowners’ insurance policies. Therefore, a flood insurance policy is the type of insurance you need to protect your home from the devastating damages caused by floods.
As per Federal Emergency Management Agency (FEMA) official website, floods can occur at any place, and a single inch of water can result in more than twenty thousand dollars worth of damage. It shows you how important an investment a flood insurance policy is. However, it is imperative to note that you will have to buy the flood insurance policy way ahead of an imminent weather event. Here are some essential inquiries to help you understand the flood insurance policy.
How Do You Know That A Flood Insurance Policy Is A Necessity?
The location of your home is a critical factor in determining if a flood insurance policy is a good investment. It is recommended that you have a flood insurance policy if you live in a flood-prone or coastal region.
In other circumstances, depending on your mortgage lender and where the home is situated, you may find out that it is mandatory to own flood insurance. Nevertheless, even if you do not reside in a flood zone, or your lender does not need it, you should still get a flood insurance policy, primarily if you are situated in a moderate to low risk flood zone. If you are not confident about your location, you can verify with FEMA’s Flood Map Services.
What Are the Costs Involved in This Kind of Insurance?
The prices for a policy depend on several factors, such as the year your house was built, its flood risk designation, how it is made, and its elevation.
It is known that if you reside in a high-risk flood zone, also referred to as Special Flood Hazard Area, the prices are higher compared to a homeowner living in a low-risk flood zone. At the same time, if you are residing in an old house, do not be surprised if the prices are high. This is because it will be more challenging to protect your aging home from flooding, and it could be more expensive to repair than a new homeowner whose house is built with the latest materials. Conclusively, as per FEMA, the average price of a flood insurance policy through the National Flood Insurance Program policy is approximately $700 annually.
What Does My Flood Insurance Policy Cover?
The National Flood Insurance Program provides two kinds of policies; construction coverage for your house and the contents coverage for your possessions. Construction coverage takes care of your house’s foundation, such as plumbing and electrical systems.
On the other hand, content coverage takes care of your belongings, such as appliances and furniture. Moreover, if it necessitates that you relocate your possessions because of a flood, your flood insurance policy is supposed to take care of the items for at least forty-five days to protect them against any damage.
Also, the flood insurance policy does not make up for damage inflicted on your lawns, fences, trees, title deeds, or any cash left behind. Additionally, a flood insurance policy is restricted to damage resulting from weather-related floods, and therefore this excludes broken washing machines, water pipes, or dishwashers.