Under the National
Flood Insurance Program (NFIP) flood
insurance is available for most enclosed buildings, and contents coverage is an
option. This includes homes, condominiums, mobile homes (on foundations),
businesses and farms. The contents of rental units are also insurable.
Flood insurance only
covers damage by rising water, whether from ponding,
river flow, or storm surge. This type of damage is NOT covered by a
standard homeowner's policy. Damage from water entering from roof damage,
broken windows or other structural penetration IS covered by homeowner's
insurance.
There is a 30-day waiting
period from the policy purchase date
until the coverage begins, with the following exceptions:
1.
When the initial purchase is in
connection with the making, increasing, extension or renewal of a loan, and
2.
When the initial purchase of flood
insurance occurs during the one year period following the notice of issuance of
a revised flood map for a community
This provision is to prevent the practice of buying
flood insurance when a major storm is predicted, only to cancel when the threat
has passed.
Flood insurance is typically necessary to obtain
federally secured funds to buy, build or renovate any structure located in a
flood hazard area. This includes federal grants, FHA and VA loans, as
well as most conventional mortgage loans.
Check to see if your property is within a designated flood hazard
area. Do this even if you do not
(or did not) require a conventional mortgage to purchase you home or
business. To protect yourself financially, you may want to purchase flood
insurance, especially if your home/business is in a flood hazard area.
The cost of mitigation or preventative measures to
reduce flood damage to an insured building is often reimbursable. Policy
holders may also recover the cost of removing insured contents from a
building. To recover these costs, community officials must declare the
building in immediate danger of flooding. The recoverable cost includes
the removal and temporary storage of contents for up to 45 days.
If your home receives flood damage, whether or not you
purchased flood insurance is important. The type and amount of federal
disaster assistance available to you changes if you do not have flood
insurance. Again, to protect yourself, you should serious consider
obtaining a flood insurance policy if your home is within a flood plain.
If a sale person quotes you rates under the National Flood Insurance Program in the thousands of dollars, STOP!
Check with other agents. NFIP rate should be the same regardless of the
company you choose. If the price quoted seems high, verify with another
company before you sign.
STEPS TO TAKE TODAY
Find out if your property is located in a flood hazard
area.
· Don't accept statements from present owners, neighbors, or sellers
that "It's NEVER flooded" or "The flooding problem has been
fixed." While it may not have flooded recently, if it flooded once,
it probably will again. It is very difficult to "fix" flood
problems.
· To find out more about your property's flood risk, contact and
licensed property or casualty insurance agent. Your local building or
codes department or perhaps the main library in your community may also be of
assistance.
· You
can also examine FEMA's Flood Maps online to
determine if your house is in a flood zone.
· Don't assume there is no flood risk simply because your property
is shown "outside the 500-year flood zone." Flood maps are
designed around anticipated flood events and cannot take into account every
possibility. Many areas in
Know your local regulations.
· Regulations for flood prone lands are often different than other
land areas. Many communities have adopted flood plain management
ordinances, and may require permits for building or developing in certain
areas.
Your home site may be zoned inappropriately for
residential development.
· As a result, construction costs could be prohibitive. Find
out before you purchase property. In some cases, the owner may be denied
a building permit for property purchase for development. Development
regulations prevent unwise use of flood prone lands, and in some cases,
development orders may require that the lowest floor be elevated above the base
flood levels. In either case, the owner faces significant and potentially
unanticipated costs. Regulations also prohibit substantial improvements,
additions or reconstruction of flood prone homes.
Make an itemized list of personal property.
· Include all of your home furnishings, clothing and
valuables. Take photographs of your home, inside and out. The list
and photographs will help an insurance adjuster settle your claim.
Uninsured losses may be tax deductible if they can be properly