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Six Things New Homeowners Should Know About Flood Insurance

One of the most challenging tasks when buying a new home is knowing how to insure the property. Asides from your lender requiring you to insure their investment, having the right insurance coverage will protect your family’s belongings from devastating loss. When considering the insurance needs of your new home, here are six important things you should keep in mind, specifically about flood insurance.

Flood insurance Is A Stand-Alone Policy

This means that flood insurance is not included in your standard home insurance policy. Many homeowners assume that their regular home insurance policy covers flood damage. Imagine their surprise and frustration when they call their insurance company after a flood only to learn that their damages are not covered.

Don’t let this happen to you! In high-risk flood areas, flood insurance is mandatory and offered through the federal government’s National Flood Insurance Program (NFIP).

Even If It’s Not Mandatory, Flood Insurance Is A Good Idea

Did you know that floods account for an overwhelming majority of natural disasters in the United States? Flood have occurred in all 50 States in the last five years. If you think that flooding can only happen in isolated catastrophic natural disasters, such as hurricanes, think again.

If you live in a low-risk area, flood insurance might be surprisingly affordable and will protect you in case of the unthinkable.

You Will Need An Elevation Certificate To Get Coverage In A High-Risk Area

Homeowners with properties located within high-risk floodplains will need the elevation certificate to get flood insurance coverage. If your house hasn’t had substantial renovations, there’s a good chance you will be able to use the existing elevation certificate for your flood insurance quote. Read this blog post for more information on elevation certificates.

There Might Be a 30-Day Waiting Period Before Flood Coverage Takes Effect

To protect insurance suppliers from people that seek coverage in the face of imminent danger, the NFIP instituted a 30-day waiting period before flood insurance protection kicks in. However, this waiting period is waived if the initial protection is purchased as part of the “making, increasing, extension, or renewal of a loan.”

Flood Insurance Policies Have Limitation And Exclusions

As of June 2018, NFIP caps available coverage on structures at $250,000. The maximum coverage allowable for personal property is $100,000 (please check their website for the most updated information). There are also limitations on items that are stored in basements. Make sure to read your policy to understand your coverage, limitation and exclusions.

Many Homes Are Incorrectly Rated

Your flood zone makes a big difference in your premium – and many homes are incorrectly rated in FEMA’s Flood Zone Maps. We can help you determine if your property is incorrectly rated with a free flood zone audit. Contact us today for your free audit!

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