Don’t let these flood insurance myths leave you high and dry!
There is quite a bit of mystique around what is covered if a flood damages your home. By now, most people know that regular home insurance doesn’t cover water damage. Policies through the National Flood Insurance Program only cover a max of $250,000, so supplemental insurance may be necessary.
It’s important to note that while many people assume that floods cause a total loss, the average water damage claim in the U.S. is only $30,000.
Myth: Only Properties on Flood Plains Get Flood Insurance
This myth probably came from the information that mortgage companies require flood insurance if you live on a flood plain. But anyone can get flood insurance; you just have to ask for it. Don’t assume that flood coverage is in your homeowners policy. It likely is not.
The average price for flood insurance is $600 per year, fyi. $50 a month could save you a lot of heartache.
Also note that you can get flood protection for just your possessions if you are a renter.
Myth: You’re covered for everything if there is a flood
You’ll likely have coverage of $100,000 for possessions, and $250,000 for the structure. That’s what federal flood insurance covers. Anything more than that will have to come out of pocket.
This is definitely something to keep in mind if you buy a home in a high risk area. Alsonote that it will not cover anything lost in the basement and also won’t put you up in a hotel during the period of time during which your home is damaged.
Myth: All water damage is equal
Untrue. As soon as your roof comes off and water comes through, you are covered by your homeowner’s policy, as compared to if a river overflows and water comes into your home. That would only be covered by a flood policy.