Getting Flood Insurance Coverage Before Its Too Late

Flood insurance coverage isn’t necessary in all areas. If you live in an area that’s considered low to moderate risk, or even if you just want some peace of mind, then it’s great coverage to have. Here’s what you should know.

Waiting Periods

It’s a good idea to look in to flood insurance before you move to a flood plain or risky area. There is a 30 day period from the day your coverage starts and the day you can claim the benefits. So deciding to purchase coverage when a big storm is forecast won’t do you any good. The earlier you sign up for the insurance, the less you have to worry about something happening during that time frame. Get it early to be safe.

Structural Coverage

Flood insurance has two separate components. The first being building property damage. This covers the structure of your home itself. This can include the foundation, electrical works, plumbing systems, HVAC systems, carpeting, cabinets, and garages. If your home is damaged by flooding you can receive up to $250,000 on these losses.

Personal Property Coverage

The second component to flood insurance is the general, or personal, property coverage. This would include things like curtains, clothing, furniture, electronics, dishwashers, throw rugs, washers and dryers, and in some cases artwork and fine furs or jewelry. The personal property coverage is capped at $100,000.

Homeowners Insurance

Many people think that their homeowners insurance will cover damage from flooding. Unfortunately, that’s a common misconception. Homeowners insurance policies will rarely if ever cover damage or loss caused from flooding. Many people will forego separate flood insurance because they assume they are covered. Never assume this. Be clear about what your homeowners insurance policy does and doesn’t cover. If you don’t live in a high risk zone, then the premiums are generally very reasonable.

Federally Funded Assistance

A lot of people will choose to forego insurance for flooding if they live in an area where it’s not covered. A lot of people assume that FEMA will step in and take care of any disaster area. The sad fact is though less then 50% of the floods that occur and cause damage are actually designated as federal disasters. The area has to be officially deemed a federal disaster before any assistance is offered.

The other down side to relying on government assistance is that most often it’s available in the form of low interest loans. Having insurance will cover your damage without having to repay a loan. In some cases the damage will be more extensive than what the insurance will cover and you will need to take the assistance as well. Having insurance will lessen the amount you will need though, making your payments lower.

Planning ahead for anything is a good idea. When it comes to flood insurance, it’s important to take steps as soon as you know you are in a risk zone to protect your home and other valuables.

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