Moorhead,MN, March 30, 2009--Clay County Sheriff's Dept. and local Search and Rescue volunteers check on residents along the Red River. Andrea Booher/FEMA

A Flood Insurance Primer for New Homeowners

Did you know that basic homeowner’s insurance does not cover floods? Many new homeowners are not aware of this fact. That can cost them.

Floods occur all across the United States—in all 50 states, in fact—and often strike with little or no warning. One moment, you may just have a little water in your basement. The next, your living room could have two feet of water in it. Floods are scary and can be very dangerous, and a decent amount of flood claims happen outside of traditionally known flood zones. This makes it imperative that a new homeowner has quality flood insurance.

There are some basics of flood insurance that every homeowner should be aware of. Read on to learn more about them.

What Flood Insurance Includes—And Doesn’t Include

Flood insurance is offered through the National Flood Insurance Program, or NFIP. NFIP is administered by FEMA (the Federal Emergency Management Agency). This kind of supplemental insurance covers up to $250,000 in structural damage, as well as up to $100,000 in content loss. Content, in this case, refers to objects like furniture.

Homeowners should know that the terms “flood” and “water damage” are not interchangeable. A flood is more about damage to the environment surrounding you, as well as your house. Water damage refers more to cracked or burst pipes, and is not covered by flood insurance.

Also, when it comes to the basement—probably the place where most floods begin—it is important to note that only essentials will be covered by flood Insurance. If you have a finished basement that has a high-definition flat-screen TV, that TV will not be covered by flood insurance.

But Do You Really Need It?

The short answer is: yes. Many homeowners with flood insurance only have it because they’re required to purchase it. For example, they may live in flood-prone areas, like near the mouth of a river. However, even if you don’t live near a river or other body of water, you should still consider flood insurance. Many areas that have been hit in the past by hurricanes weren’t necessarily considered high-risk areas in terms of flooding. Many people in those areas still had damage to their homes, though. Unfortunately, not all of them had flood insurance.

Flood Insurance Can Cost Less Than You Think

Even if you don’t live in a flood-prone area, you should still consider getting flood insurance. It can cost less than $1,000 a year to protect your home from flood damage. If you’re ready to insure your home against damaging floods, contact an ABCO agent today to compare rates.

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