It’s almost that time of year for April showers. Are you adequately covered in case of catastrophic rain causing a water back up loss to your home, condo or personal belongings stored in a basement? Water back up coverage will kick in when water comes into your home from a sewer, sump pump or drain. A standard finished basement can cost about $5000 just for the clean up.
Even if you do not live in a high-risk area, it is worth looking into flood insurance as more than 20 percent of all flood insurance claims are filed in low-to-moderate flood-risk areas.
Here are some important facts about flood insurance from the Insurance Information Institute:
- Standard homeowners and renters insurance does not cover flood damage: Flood damage is excluded under standard homeowner’s policies, although it is covered under the comprehensive section of a standard auto insurance policy. Only a flood insurance policy, available to homeowners and renters through the federal government, will cover flood-related losses.
- Flood insurance is easy to purchase. Flood insurance is available on a replacement cost basis for the structure of the home and on an actual cash value basis for personal property.
- Flood insurance is affordable: The annual premium for a residential NFIP policy starts at $112 per year, according to FEMA, and increases according to the level of flood risk and amount of coverage needed. The maximum coverage amount is $250,000 for the structure of the home and $100,000 for the contents of the home.
- There is a 30-day waiting period before a flood insurance policy takes effect, so don’t wait until the last minute to purchase it.
- It is easy to assess your flood risk: More than 20,000 communities in all 50 U.S. states and territories voluntarily participate in the NFIP, encompassing nearly all properties in the nation’s high-risk flood zones. Enter your address in the FloodSmart Tool to determine your level of flood risk.
- Excess flood insurance policies add an extra layer of coverage: A growing number of private insurers have begun offering excess flood policies, intended to provide water damage protection to homeowners over and above the coverage provided by the NFIP policies.
- Without insurance, relief from floods primarily comes in the form of loans: If your community is declared a disaster area, no-interest or low-interest loans are usually made available by the federal government as part of the recovery effort. These loans are just that—loans—and must be paid back. Obtaining a flood insurance policy is the only way to protect yourself fully from the cost of flooding.
Call our agency today to discuss your specific needs for this very important coverage!