Flood Insurance for Me?

Why Buy Flood Insurance

Moorhead, Minn., March 30, 2009 -- Sand Bagged home in Minnesota surrounded by flood water. Andrea Booher/FEMA

…this home needed Flood Insurance, photo courtesy of Andrea Booher/FEMA

Flood Insurance only provides coverage for damage caused by Flood and nothing else. Furthermore, flood is NOT covered by a Home Insurance policy.  Sounds simple enough. Now that we have that out of the way, let’s go through some of the peculiarities of Flood Insurance.

What’s Considered a Flood

The first thing you need to know, for flood insurance purposes, is the definition of a flood. “A flood, is 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.” The water can come from the ocean, lakes, rivers, ponds, streams, sewers, or simply an intense rainstorm. Contrary to popular belief, flooding isn’t just an issue for coastal property or low-lying areas near water. According to www.floodsmart.gov, people located in areas considered to be moderate- to low-risk for flood, submit more than 20 percent of National Flood Insurance Program claims.

Flood Examples in Southeastern Massachusetts :

  • Flash floods from a highly intense rainstorm or a sudden massive snowmelt
  • Coastal floods from a severe storm front that creates high waves that flood the coastline
  • River floods from an extended rainstorm that leads to overflow of major rivers, streams, lakes, and ponds
  • Urban floods from a city sewage/drainage system at capacity that cannot drain away anymore rainfall
  • Dike or Dam break from a sudden release of water from a breach point that spreads out and flows to lower lying areas before slowly rising


How to Buy a Flood Policy

Buying a policy, is determined by the flood zone your property is located in as well as the amount of coverage you choose. For those of you with a mortgage and located in a high risk flood zone, you have no choice. Your lender must require that you buy flood insurance for at least the value of your loan. If you do not have a loan on your property, you are not required to buy flood insurance. Ideally, it is recommended that property owners buy enough insurance to cover the replacement cost of their property.  Coverage may also be purchased for the contents of the property but is completely optional and not required by mortgage lenders.

A number of factors are involved in determining the annual cost of flood insurance. Characteristics of the property such as, the number of floors, age of building, flood zone, occupancy, and deductible chosen. Newer buildings may have the added burden of providing an elevation certificate

For those of you thinking about buying  flood insurance yet are not required by your bank to buy the coverage, don’t wait until the last minute. When purchasing flood insurance and it is not a requirement of a loan coverage cannot be purchased immediately. This scenario comes with a thirty day waiting period before coverage becomes effective. Consequently, it prevents property owners from just waiting until a big storm is about to hit, before attempting to buy Flood Insurance.


What Does Flood Insurance Cover?

Your policy protects against flood damage, to the insured building and it’s foundation, including debris removal. In addition, the following are also covered:

  • Plumbing, Heating, hot water and air conditioning systems
  • Built-in appliances, stoves, refrigerators
  • installed and attached cabinets, bookcases, paneling, window blinds
  • Unattached garage but only up to 10% of the coverage for the main house

Personal property, also known as contents of the dwelling may be insured under a flood policy. You choose how much coverage, if any, you wish to protect your belongings. Emaples of contents covered :

  • furniture, window treatments, and clothing
  • portable appliances
  • carpeting that is not permanently installed
  • artwork, furs, and some valuable articles, but only up to $2,500


What is Not Covered by Flood Insurance?

  • Outdoor Property, including trees and plants, patios, decks, walkways, and seawalls
  • Most self-propelled vehicles
  • Money, valuable papers, and precious metals, and Expenses for temporary housing
  • Limited coverage for items in basements, crawl spaces, and areas below the lowest elevated floor


Buy Flood Insurance

So now we know that your Home Insurance Policy does not cover any damage from flooding. Only a flood policy can protect you from the financial impact of flood damage. We also know, anyone can purchase a flood policy, including people located in areas considered to be moderate- to low-risk areas. It is time you contacted your friendly, neighborhood, Independent Insurance Agent, for a quote.