How to Determine if You Should Have Flood Insurance
If you live in a designated flood zone anywhere in the U.S. and you carry a mortgage, you are required to have flood insurance. If you only rent, carrying flood insurance is still a good idea. Unfortunately, however, though more than 20,000 communities are considered flood zones, only about 17 percent of Americans have flood insurance. To assess your need for flood insurance, it is important to keep several pointers in mind.
Other People Are Reading
Instructions
-
-
1
Check if you live in a flood zone. Only people who do are allowed to buy flood insurance. Access the Federal Emergency Management Agency website and check the Map Service Center for your area to see if you live in a 100-year or 500-year flood zone.
-
2
Find a local insurance agent on the FloodSmart website. Because the National Flood Insurance Program underwrites all flood insurance, the cost will be the same no matter which agent you consult. Your home insurance agent may already sell flood insurance or can perhaps recommend an agent who does.
-
-
3
Carry flood insurance if you rent. Many make the mistake of not carrying flood insurance, thinking it is unnecessary for renters. However, even your landlord is covered, it does not mean your possessions are covered. You can carry flood insurance on the contents of your dwelling up to $100,000, whether you live in a rental house or apartment. With this coverage, you can replace your possessions in the event of flood.
-
4
Insure your home, even if you carry no mortgage. The law does not mandate carrying coverage if you hold no mortgage; however, coverage is still important for the same reason as renters. You want your possessions to be covered.
-
5
Don't depend upon disaster relief to cover your home. Declarations of federal disaster areas occur only 50 percent of the time. Even then, help comes only in the form of low-interest loans. Thus, buy your own flood insurance to ensure you are covered.
-
6
Think of flood insurance as a necessary protection. You work hard to pay for your home and its contents so you don't want to lose them to a flood. Flood insurance is added protection against damage to your home, much like fire and theft protection; thus, if you don't already have flood insurance, think about adding it if you live in a flood zone.
-
7
Know what a flood insurance policy covers. Home flood insurance policies only cover up to $250,000, unless you add additional coverage. Coverage of the home generally includes the house structure, garage, installed fixtures such as kitchen cabinets, permanent shelving, furnace, hot water heater, refrigerator, stove, built-in dishwasher and furnace. Your basement is covered for structural elements, furnace and air conditioning unit, hot water heater, foundation, fuel tank, light fixtures and cost of cleanup. Basement items not covered are finished walls, carpet or other types of flooring and anything stored down there. Be sure you know what your flood insurance covers so you can buy adequate insurance to cover all items.
-
1
Tips & Warnings
Take an inventory of your home's contents to get an estimate on the cost of replacing your items.
Read the insurance policy carefully to make sure you understand the coverage.
Don't assume your homeowner's insurance covers flood. It does not unless you specifically add flood coverage to the policy.
References
Resources
- Photo Credit Comstock/Comstock/Getty Images
