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Flood Insurance

Good Flood Insurance

What is this Coverage?

The major majority of homeowner insurance policies will exclude coverage for damage sustained by flooding. In most instances, should you need flood coverage for your home, supplemental insurance coverage will be needed. If your home is located in a zone that is considered at high risk for flooding, this type of coverage is made more readily available through the NFIP or National Flood Insurance Program.

The NFIP

NFIP Insurance was created in response to the incredible damage that hurricanes and other natural disasters had caused to real estate due to flooding in certain parts of the country. The Federal Emergency Management Agency (FEMA) is the governmental agency in control of the NFIP.
The main objective of the NFIP is to alleviate the financial consequences of flooding on personal property. There are two main efforts in place: One, FEMA assists and coaxes communities situated in these flood zones to enact sensible floodplain management strategies. The second way that the NFIP program assists is through the provision to homeowners of relatively inexpensive insurance against flooding in high risk zones.
Before the NFIP was established, private insurance providers were highly resistant to provide insurance against floods. As a result, flooding disasters were causing enormous financial hardships and ignored destruction to the ranks of the uninsured. The government stepped in to help as the whole scenario became more dangerous for the well being of much of our populace. This insurance program is designed so that FEMA can join with the insurance companies in mitigating the financial repercussions of flood damage in NFIP deemed floodplains.
In the case of a policyholder’s home being damaged by a flood, a part of the claim expense is handled by the NFIP. By spreading out the exposure to loss in high-risk areas, insurance is made more affordable to homeowners (and the insurance company).
Banks and other lenders will require a prospective homeowner to obtain NFIP insurance, should the home be located in an NFIP floodplain zone. Keep in mind that this type of insurance is also available regardless of whether the property is considered high risk. Often times it is worth the extra expense when considering the peace of mind in knowing that you as the homeowner is protected in a flood event.






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