{"id":8056,"date":"2023-11-29T07:45:57","date_gmt":"2023-11-29T07:45:57","guid":{"rendered":"https:\/\/businessyield.com\/ins\/?p=8056"},"modified":"2023-11-29T07:46:02","modified_gmt":"2023-11-29T07:46:02","slug":"flood-insurance","status":"publish","type":"post","link":"https:\/\/businessyield.com\/ins\/insurance-guide\/flood-insurance\/","title":{"rendered":"FLOOD INSURANCE: All You Need To Know"},"content":{"rendered":"

Too many homeowners believe they do not require flood insurance. According to the National Association of Insurance Commissioners, only approximately 5% to 15% of homeowners have it. However, according to the most recent FEMA data, flooding affects 99% of counties in the United States.
To make matters worse, many homeowners believe their home insurance already covers flood damage. However, flood damage is not covered by a normal home insurance policy.
If your home is flooded, you could face a significant financial calamity if you do not have flood insurance. To put this in context, according to the most recent FEMA data, the average payout on a flood claim from the National Flood Insurance Program (NFIP) is $52,000.<\/p>

What Is Flood Insurance?<\/span><\/h2>

Flood insurance is a type of property insurance that covers damages caused by water damage, specifically flooding. Flooding can occur as a result of severe or persistent rain, melting snow, coastal storm surges, clogged storm drainage systems, or levee dam failure.<\/p>

A flood is regarded as a catastrophic and significant occurrence in many places, and the damage or devastation it produces is not covered if you do not have additional insurance.<\/p>

What Does Flood Insurance Cover?<\/span><\/h2>

Flood insurance is divided into two categories: dwelling (your house) and contents (your belongings). Depending on where you buy your flood insurance, you may be able to purchase a building-only policy, a contents-only policy, or both.<\/p>

#1. Dwelling Protection<\/span><\/h3>

Dwelling coverage, often known as building coverage, pays to restore or rebuild your home following flood damage. For example, if flood water damages your electrical and plumbing systems, a flood insurance policy’s dwelling coverage will pay to repair or replace them.<\/p>

The NFIP’s flood insurance policy limits residence coverage to $250,000. In the private market, you may be able to purchase greater levels of home coverage. Flood Guard, for example, sells policies with up to $5 million in dwelling coverage, while Neptune Flood Insurance offers plans with up to $4 million in dwelling coverage.<\/p>

#2. Contents Coverage <\/span><\/h3>

Personal property coverage, commonly known as contents coverage, protects your personal possessions, such as furniture, clothing, and appliances. For example, if flood waters ruin your living room furnishings, a flood insurance policy’s contents coverage will pay to repair or replace the items.<\/p>

The contents coverage under an NFIP flood insurance policy is limited to $100,000. Higher content coverage may be available on the private market. Flood Guard and Florida Peninsula Insurance Co., for example, offer up to $1 million in content coverage.<\/p>

Basics of FEMA Flood Insurance for Residential Properties<\/span><\/h2>

<\/span><\/h2>
Coverage<\/strong><\/td>FEMA flood insurance policy<\/strong><\/td><\/tr>
Building coverage limit<\/strong><\/td>$250,000<\/strong><\/td><\/tr>
Contents coverage limit<\/strong><\/td>$100,000<\/strong><\/td><\/tr>
Waiting period for coverage after you buy (there are some exceptions)<\/strong><\/td>30 days<\/strong><\/td><\/tr>
Building and contents coverage deductible choices<\/strong><\/td>From $1,000 for each (no discount) to $10,000 for each (40% discount)<\/strong><\/td><\/tr>
Loss of use<\/strong><\/td>None<\/strong><\/td><\/tr><\/tbody><\/table><\/figure>

What Does Flood Insurance Not Cover?<\/span><\/h2>

Flood insurance does not cover all kinds of water damage. Typically, an NFIP flood policy does not cover:<\/p>