Types of Flood Insurance Coverage Policies

Many people mistakenly think that their home insurance policy will cover them in the event of a flood. Those people are often mistaken. If you want a home to be protected from flood damage, it is vital to purchase a separate homeowner insurance policy for floods.

Why Flood Insurance Is Important

Basic home owner insurance policies typically do not cover damage caused by floods. It can be devastating to expect home to be insured in the event of a disaster, only to discover that it is not.

Unfortunately, many have learned over the years that flood damage can devastate a home. Anyone living in the gulf coast region can attest to the destruction water can do to a home and personal belongings.

Flood insurance can protect your belongings in the event of a flood. This type of home insurance covers many different aspects of a home. Most policies include the basic structure of a house, while others can be more involved and cover the repair and replacement of floors and carpeting, as well as heating and air conditioning units.

Most flood insurance companies also offer additional options that allow you to insure belongings. In many cases, this can be costly. Just a few inches of water can destroy furniture and precious keepsakes. Replacing expensive electronics, such as computers, can add up to a very large tab.

Most people believe that floods cannot happen in their area. But, according to the Federal Emergency Management Agency (FEMA), everyone lives in a flood zone. The only thing that varies between zones is how much of a risk each area has for floods.

Even areas with no history of flooding could be at risk for floods if circumstances align themselves properly. Floods happen in all 50 states, including the desert areas, like Arizona and Nevada. Floods are usually brought about by excessive rain, sudden snow-melt or water runoff.

If you are moving to a newly developed area, make sure you speak with a home owner insurance agent. Many construction sites attempt to change the natural water runoff of an area they want to develop. In many cases, these redirections do not last for long. After a few seasons, the water generally returns to its normal course and could flood the development anyway.

National Flood Insurance Program

The importance of proper flood insurance is so important that the American government has begun to take steps to ensure that everyone who owns a home has flood insurance. Initiated by FEMA, there is low-cost flood insurance available to any interested community.

In the event of a serious flood, the President usually declares a state of emergency. This allows the residents of that area to have access to government aid. This aid usually comes in the form of financial assistance.

Government financial assistance is generally given as a low interest loan. Because there are so many people dependent on these loans for assistance, the amount of money every individual has access to remains limited.

Having a government backed flood insurance policy can help provide you with security without taking away too much from your paycheck. Since this program is supported by FEMA, the government insures the policies, so you do not have to worry about having difficulties filing a claim.

Many people not living in coastal regions do not consider owning flood insurance a priority. Generally, when people think of flooding, they think of hurricane regions. This is especially true since the 2006 hurricane season.

However, the disaster area that was the gulf coast region should only serve as a reminder to the rest of the country that no one can be over-prepared for an emergency. Home insurance companies in New Orleans are still sorting out what damages they can cover under their policies.

In the aftermath of Hurricane Katrina, there was a lot of controversy surrounding the cause of damages. If homes were destroyed during the hurricane, then those damages would have been covered by a standard home owner insurance policy. If the home survived the hurricane and was damaged only after the levies broke, then the homeowner will have needed flood insurance to get the damages covered. It may seem like cutting hairs since the levies would not have failed if it were not for the hurricane, but this distinction was important for deciding who held the financial responsibility for the damages.

Many landlocked areas are also susceptible to flood damages. Overflowing rivers and lakes cause millions of dollars of damage every year. The government is dedicated to making sure we have enough home insurance coverage to be protected from these disasters.

Private Flood Insurance Policies

The United States government regulates flood insurance, so it is generally inexpensive. These insurance policies usually range from about $250-$300 a year. Of course, these numbers will change depending on what level of flood plain you live on.

Flood plains are divided up into three zones; high-, medium-, and low-risk areas. A house on a beach would undoubtedly qualify for a high-risk flood plain. Beachside owners would most likely have to pay more for flood insurance than someone who lives on a hill in an area with no history of flooding.

There are many areas in coastal regions that the government will not insure. These areas are the ones that are especially prone to repeated flooding. Living in one of these areas requires a special policy from a private home insurance company that may charge a considerable amount more than government assisted home insurance.

Finding a flood insurance policy from a private home insurance company is similar to finding a good home owner insurance policy. Researching until the right plan is found is all that is needed to have great coverage, although it may come at a higher price.

In Conclusion

For a homeowner, flood insurance can be one of the greatest investments ever made. Providing protection for your home can be essential to the security of one of the largest investment most of us will ever make.

This fundamental protection against nature is so important that the government has put forth considerable efforts to ensure everyone has easy access to it. To many people, the home grown up in is like part of the family. Make sure you protect it much the same way.


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