![]() ![]() Something damaged by fire or flood is still damaged and needs replaced. Getting the same coverage is usually a good choice because you are covering the same things with both policies. The best way to figure out how much you need is to look at your homeowner’s policy. You can get up to $500,000 in coverage, but the majority of people probably will not need that much. Remember it is offered through NFIP, so it is completely different than other insurance coverage options. If you get this type of insurance, you will be required to purchase is as a separate policy from your renter’s or homeowner’s insurance policy. In some cases, lenders take it upon themselves to require homeowners to have this coverage if it is available. Congress has created a requirement for some lenders to ensure homeowners have this insurance if the property is located in a high-risk area. You may also be required by federal law to purchase it. Some areas are mandated by federal law to offer insurance. Almost any type of property can be covered. This includes rentals, residential buildings and commercial properties. Where it is available, you can get it to cover any type of property. If you live outside of the NFIP areas, you cannot get this type of coverage, even if you feel you are at risk for flood damage. Generally, these are areas that are prone to flooding. It is considered a special insurance and is only available to those located in specific areas that participate in the National Flood Insurance Program. The most important thing to understand about this type of insurance is that it is not available to everyone. Trying to rebound from a flood without proper insurance coverage can be difficult if not impossible for most people. It provides you with security that should the worst happen, you will not face financial ruin because of it. Having this coverage is a smart idea if there is even a chance your home could be a victim of flooding. However, if after the first instance of flooding, you do not get and maintain insurance, you will no longer be able to get benefits from FEMA or any other government agency if a future flood occurs. ![]() If you live in an area at a high risk for flooding and you do experience a flood, the federal government offers assistance from FEMA. Water can also cause lasting issues, such as mold and rot, that cost a lot of money to fix. Not only would you need to replace flooring, wall materials and belongings but also you would get into having to replace electrical and possibly other systems. Imagine if your home was filled with a few feet of water. An inch of water in your home can lead to about $20,000 in damage. Looking at some numbers, flooding is very costly. It is actually the single most common natural disaster in the country. The reality is that almost every area can and will experience flooding at one point. It is not offered this way because it is not needed. It is offered separately because some areas may never have flooding and homeowners do not like to pay for insurance they do not need. Many people think they do not need this type of insurance because it is not offered as part of a homeowner’s policy.
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