Hurricane season is in full swing right now, and even though this season has been mild compared to the last few years, you should still be prepared for the worst.
In fact, even if you do not live near the coast, you should still review your flood insurance policy. Floods occur in every state and one of the most important things you can to protect your assets is to buy flood insurance.
Is Flood Insurance Necessary?
Almost always, the answer is yes. If you live on top of a high hill, it might not be necessary, but otherwise you might want to consider it. Flood insurance is almost always separate from your normal home owner’s insurance, so the first thing to do is make sure you have a flood insurance policy.
Don’t just assume your home owner’s policy will cover flood damage because often, homeowner’s insurance does not cover damage from floods and storms. States that are most likely to need flood insurance include:
- Alabama
- California
- Connecticut
- Florida
- Georgia
- Louisiana
- Maryland
- Massachusetts
- New Jersey
- New York
- North Carolina
- South Carolina
- Texas
- Washington
Also, if you live in a flood plain of a major river, flood insurance may be required or just a good idea.
Looking for better homeowner’s insurance rates? Check out this article for how to save on homeowner’s insurance.
What Flood Insurance Covers
Flood insurance is a type of insurance that covers losses to your property caused by flood waters.
Property Coverage
Flooding is a killer for your personal property. FEMA estimates that a single inch of water that floods throughout a 2,500 square foot home would cause $26,807 of property damage. Flood insurance takes care of these types of property damage:
- Foundation
- HVAC
- Home electrical system
- Plumbing
- Garage (attached/detached)
- Bookcases (built in/attached)
- Cabinets
- Carpet
- Appliances (kitchen and others)
- Removal of Debris
Coverage for Property damage on standard policies is going to max out at $250,000. You can purchase additional coverage if you need to for more expensive homes.
Possessions Coverage
Your personal posessions can also be terribly damaged by flood. One thing to be mindful of is that what you receive from insurance is the value of the item today, not how much you paid for the item.
This includes any depreciation of the value over time. This means you shouldn’t expect to get anything close to your original cost, unless you are dealing with collectibles.
Personal possessions covered under a flood policy are:
- Electronics
- Clothing
- Small appliances
- Home decor
- Luxury items (this can have limits)
Personal possessions are going to be covered up to $100,000. Once again, if this does not meet your needs you can always purchase additional coverage.
How To Buy Flood Insurance
The National Flood Insurance Program (NFIP) is the primary source for flood insurance in the the US. The best place to buy flood insurance is from a licensed private insurance company or independent property and casualty insurance agent in your state.
To find a company that participates in the NFIP, check out FEMA’s list of participating insurance companies.
30 Day Waiting Period for Flood Insurance
Normally, there is a 30 day waiting period from the time you purchase flood insurance until the time the insurance becomes effective. In locations where flood insurance is required for your mortgage or property loan, the flood policy takes effect immediately. It is important to buy your policy before the storm seasons because of the 30-day waiting period.
How Much Does Flood Insurance Cost?
Flood insurance can be very inexpensive, with many policies starting at less than $10 a month. Of course, the cost varies by location. Still, it is a worthwhile expense to protect your assets.
I can’t give you an exact number on how much that flood insurance is going to cost for your home. The insurance company is going to look at dozens of different factors when they are deciding how much they are going to charge you for the additional protection.
When you’re looking for flood insurance, the company is going to look at the state that you live in, the value of your home, any nearby bodies of water, and much more. In the vast majority of cases, people are surprised to see just how affordable flood insurance can be. You never know what’s going to happen tomorrow or what Mother nature is going to throw at you.
Even though you cannot predict the weather, you can protect your belongings from the damage the weather may cause.
Every year, there are thousands of people that experience serious financial loss because of floods. Floods can destroy everything that you own. All of your valuables and family memories. There is nothing that you can really do to replace all of those things, but flood insurance will help you get back to normal without having to pay to replace all of those things.
For more information about floods and flood insurance, check out FEMA’s Fast Facts About Flood Insurance.
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William Brooks says
Great post… this is something a lot of people forget to do.
I live in the Hurricane belt so to speak so I appreciate this post!