When you buy a home, your mortgage company mandates that you purchase homeowner’s insurance. This can protect you if unforeseen events cause damage to your home, including fire, theft or weather events.
However, flood damage is not covered by typical homeowners’ policies. Since damage can be extensive and expensive, a separate policy can bring peace of mind, even though flood insurance policies do not necessarily cover all flood damages.
What is typically covered by flood insurance?
There are some items, that if damaged, are usually covered by flood insurance policies. They include:
- Essential systems, like electrical and plumbing
- Personal property, including clothing, furniture, and electronic equipment
- Carpets and window treatments
- Drywall, paneling and cabinets
- Detached garages and outbuildings
What is not usually covered?
Flood insurance has numerous exclusions. Some of these include:
- Damage from moisture, mildew, or mold
- Damage caused by earth movement (even if a flood caused the movement)
- Temporary housing or loss of use of the property
- Anything outside an insured building, like wells, septic systems, decks, pools
- Motor vehicles
What is the difference between NFIP and private insurance?
NFIP is the national flood insurance program, offering standard policies with premiums set by FEMA. There are coverage caps of $250,000 for buildings and $100,000 for contents. This insurance is available nationwide.
Private flood insurance is becoming more commonplace. These policies can supplement an NFIP policy or replace it entirely. The premiums may be lower and may provide more extensive coverage.
Flood insurance can close a gap you may have with your homeowner’s policy, and provide peace of mind. It is worth considering, even if you do not live in a flood zone.