What is flood insurance?
Homes and businesses located in communities that participate in the National Flood Insurance Program (NFIP) are eligible for flood insurance at a modest cost through this federal program. Under this program, insurance companies issue flood insurance and the federal government administers the program. Flood insurance normally requires a 30-day waiting period before the insurance is effective. But exceptions are made for certain circumstances-such as if you’ve purchased a home and the closing is in less than 30 days.
Unlike a standard homeowners policy, flood insurance covers losses to your property caused by flooding. Some of the things a standard flood policy will cover include: • structural damage • furnace, water heater and air conditioner • flood debris clean up • floor surfaces such as carpeting and tile You can also buy a flood insurance policy to cover the contents of your home, such as furniture, collectibles, clothing, jewelry and artwork. Policies are available in three forms: Dwelling (most homes), General Property (apartments and businesses), and Residential Condominium Building Association (condominiums). It’s important to know that if you have a federally backed mortgage on a home located in a high-risk area, federal law requires you to purchase flood insurance. Also, if you’ve received a federal grant for previous flood losses, you must have a flood policy to qualify for future aid.
Flood insurance is a special policy that is federally backed by the NFIP and available for homeowners, renters and businesses. The standard flood insurance policy pays for direct physical damage to your insured property up to the replacement cost or actual cash value (ACV) of actual damages or the policy limit of liability, whichever is less. Homeowners: You may purchase flood insurance covering up to $250,000 of flood damage to your home. A standard flood policy will cover structural damage, including damage to the furnace, water heater, air conditioner, floor surfaces (carpeting and tile) and debris clean-up. The contents of your home are not covered under a standard policy, but for an additional premium, you also may purchase flood coverage for up to $100,000 of damage to your personal property. Coverage for basements, crawlspaces and ground-level enclosures on elevated homes is limited. If your home has these spaces, be sure to ask your insurance agent about any restrictions in you
