Flood Insurance is Important for a Homeowner
A flood can devastate a home. It can cause serious damage to your belongings and home. There is also a chance of mold developing if the flood isn’t properly handled. It doesn’t have to be a big major flood either. A few inches of water may cause tens of thousands of dollars in damage.
Flood insurance is not included with standard homeowner’s insurance. A standard policy might cover general water damage, but not flood damage. For insurance purposes, water damage refers to losses due to events like storms. For example, if wind blows out a window and the rain damages the room, then homeowner’s insurance may pay the claim. But if the water damage is due to a flood, it’s not covered. You need a separate policy specifically for flood damage.
Some homeowners get flood coverage from the National Flood Insurance Program. This program was authorized by Congress in 1968 to fill in the flood coverage gap left by lack of coverage through homeowner’s insurance. If you qualify for this coverage, then you will be limited to $250,000. But you can also buy coverage for personal property up to $100,000. There is also a 30-day waiting period before coverage begins. Then there is always the option of getting an extra insurance policy from a private sector insurer. That’s what most homeowners have to do, as not many qualify for the NFIP.
Any homeowner would benefit from having flood insurance. If your home is located on a flood plain, then your mortgage lender probably requires it. But keep in mind that the risk of floodwater damage isn’t limited to flood plains. Most claims are for homes that aren’t on flood plains.