Flood Policy – What You need to know
Flood Insurance Broker
Flood insurance can only be purchased through an insurance agent or broker; you cannot buy it directly from the federal government.
Deductibles apply separately to building and contents with different amounts to choose from. Like other insurance plans, a higher deductible will lower the premium you pay but will also reduce your claim payment. Your mortgage lender can also set a maximum amount for your deductible.
Homes and businesses with mortgages from federally regulated or insured lenders in high-risk flood areas are required to have flood insurance. While flood insurance is not federally required if you live in a moderate-to-low risk flood area, it is still available and strongly recommended.
The NFIP, a federal program, offers flood insurance, which can be purchased through most leading insurance companies. Rates are set and do not differ from company to company or agent to agent. These rates depend on several factors, including the date and type of construction of your home, along with your area’s level of risk. Most premiums include a Federal Policy Fee and ICC Premium. If your community participates in the Community Rating System (CRS), you may qualify for an insurance premium discount in some communities of up to 45% if you live in a high-risk area and up to 10% in moderate-to-low risk areas.
Flood insurance policies cover physical damage to your property and possessions. You can use the following list as a general guide to what is and isn’t covered to help you better understand your policy and coverage.
- The insured building and its foundation
- Electrical and plumbing systems
- Central air conditioning equipment, furnaces and water heaters
- Refrigerators, cooking stoves and built-in appliances such as dishwashers
- Permanently installed carpeting over unfinished flooring
- Permanently installed paneling, wallboard, bookcases and cabinets
- Window blinds
- Detached garages (up to 10 percent of building property coverage); detached buildings (other than garages) require a separate building property policy
- Personal Conents Property
- Personal belongings, such as clothing, furniture and electronic equipment
- Portable and window air conditioners
- Portable microwave ovens and portable dishwashers
- Carpets that are not included in building coverage
- Clothing washers and dryers
- Food freezers and the food in them
- Certain valuable items such as original artwork and furs (up to $2,500)
Whats Not Covered
- Damage caused by moisture, mildew or mold that could have been avoided by the property owner
- Currency, precious metals and valuable papers such as stock certificates
- Property and belongings outside of an insured building such as trees, plants, wells, septic systems, walks, decks, patios, fences, seawalls, hot tubs and swimming pools
- Living expenses such as temporary housing
- Financial losses caused by business interruption or loss of use of insured property
- Most self-propelled vehicles such as cars, including their parts (see Section IV.5 in your policy)
Flood Insurance For Basements and Areas Below the Lowest Elevated Floor
Coverage is limited in basements regardless of zone or date of construction. It’s also limited in areas below the lowest elevated floor, depending on the flood zone and date of construction. These areas include:
- Crawl spaces under an elevated building
- Enclosed areas beneath buildings elevated on full-story foundation walls that are sometimes referred to as “walkout basements”
- Enclosed areas under other types of elevated buildings
- Make sure to ask your broker for additional details on your basement coverage.