How does Flood Insurance work?

Floods are one of the most common and costly natural disasters in the United States, yet many homeowners are not properly insured against them. In this blog post, we will discuss the importance of flood insurance and dispel some common misconceptions about this type of coverage.

First, it is important to understand that standard homeowners insurance policies do not cover damage caused by floods. In order to be protected against flood damage, you must purchase a separate flood insurance policy. These policies are available through the National Flood Insurance Program (NFIP) and some private insurers.

Many homeowners assume that they do not need flood insurance because they live in an area that is not considered high-risk for floods. However, it is important to note that floods can occur anywhere, not just in designated flood zones. In fact, 20% of flood claims come from low to moderate-risk areas. It is important to consider the potential cost of flood damage, which can be substantial, when deciding whether or not to purchase flood insurance.

Another common misconception is that the government will provide assistance in the event of a flood. While the Federal Emergency Management Agency (FEMA) does offer assistance to those affected by floods, this assistance is typically in the form of loans that must be repaid, rather than grants. Flood insurance can help to cover the cost of damage and can also provide additional living expenses if your home becomes uninhabitable.

It is also important to note that there is typically a 30-day waiting period from the time you purchase a flood insurance policy until it takes effect. This means that if you wait until a flood is imminent to purchase a policy, you will not be covered. It is best to purchase flood insurance well in advance of the flooding season in your area.

In conclusion, flood insurance is an important consideration for homeowners. It is important to understand that standard homeowners insurance policies do not cover flood damage, and that floods can occur anywhere. Purchasing a separate flood insurance policy through the National Flood Insurance Program or a private insurer can provide financial protection in the event of a flood. Don't wait until its too late, consider getting flood insurance today.