Flood Insurance Policies
The National Flood Insurance Program defines a flood as "a general and temporary condition where two or more acres of normally dry land or two or more properties are inundated by water or mudflow." Nearly all homeowners insurance policies don't cover flooding.
What's insurance for floods?
Flood coverage is a specific type of insurance that covers a person's premises and its contents from flooding. The lack of flood coverage operates against homeowners who sustain flood damage and then learn that flooding is an excluded peril under their homeowners policy. About 25 percent of all flood claims are for property that isn't even on a mapped flood plain.
Who is flood coverage for?
You don't have to live on a flood plain to get insurance for flooding. A homeowner who lives in an area that participates in the National Flood Insurance Program (NFIP) can get insurance for floods. Even renters can get it to cover their personal property. Anybody who lives in an eligible area who has a mortgage is required by their lender to have flood coverage, but remember that it doesn't go into effect until 30 days after you've bought the coverage. Policy limits on NFIP coverage are set at $250,000. If your $350,000 home floats away in a flood, that $100,000 deficiency is your personal financial problem.
If you weren't in a flood plain 15 years ago when you bought your home, that doesn't mean that you're not in one now. Learning whether you're in a floodplain is easy. The federal website www.floodsmart.gov will tell you. Just type in your address, and you'll get the information you need.
Private flood coverage
For those who aren't eligible for NFIP coverage, a handful of private insurance companies carry flood coverage. Ask your broker or agent, and they can line you up with these insurers. You probably don't have to worry about flooding if you're at the top of the hill. Otherwise, you'll probably want to talk to your agent about flood coverage.
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