In light of all the unfortunate flooding we’ve all been seeing on the news of late, you may be wondering, “What if this happened to me? How can I protect myself and my family?”
According to FloodSmart.gov (the official site of the National Flood Insurance Program), everyone is at risk of flooding. Floods can happen almost anywhere. In fact, floods are the most common natural disaster in the U.S. They can happen even if you don’t live in a high-risk area. For instance, a flood can happen during winter when temperatures rise suddenly and the frozen ground can’t absorb the melting snow.
Floods can be extremely costly. Over the last 10 years, the average flood claim has amounted to approximately $48,000. For instance, the cost of a 6-inch flood in a 1000- square foot home is about $20,000.
Who Is Required to Buy Flood Insurance?
For homeowners who live in coastal and high-risk zones, flood insurance is mandatory. The Federal Emergency Management Agency (FEMA) mandates it for any mortgage that is backed by the government.
For homes built in low to moderate-risk and undetermined risk zones, flood insurance is optional. While flood insurance is not federally required for moderate-to-low risk areas, it is still recommended. Some people choose to purchase flood insurance just for the peace of mind.
Is My Home In A Flood Zone?
Even if you are renting, it’s still wise to learn if your home is in a flood zone. You can ask your insurance company or your community floodplain manager for a Flood Insurance Rate Map (FIRM). A FIRM will generally show a community’s base flood elevations, flood zones and floodplain boundaries. Keep in mind that FIRM maps are constantly being updated due to changes in geography, construction, mitigation activities and meteorological events.
How Can You Buy a Flood Insurance Policy?
Unfortunately, standard homeowners’ insurance doesn’t cover flooding. This means homeowners have to purchase separate flooding insurance. There are two ways an owner can purchase flood insurance:
- If the property is required to have flood insurance and is financed with a federally backed mortgage (FHA, VA, Fannie Mae, Freddie Mac) then the owner can purchase insurance through the National Flood Insurance Program (NFIP).
- If the property is not in a high-risk or coastal area and having flood insurance is optional, then the owner can purchase a policy through the NFIP or with an insurance company that offers this type of insurance.
Keep in mind that regardless of where you purchase the flood insurance (NFIP or an insurance company) you will always use an insurance agent to purchase it. You can always contact the NFIP for a referral to an insurance agent.
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