Home insurance is a requirement if you have a mortgage, which may cause some new homeowner to select the bare minimum amount of insurance. Your insurance agent will most likely ask if you want to add flood insurance to your policy. Before you decline the coverage, it's important to know the following 3 things about it.
Flood Insurance May Be Required
The local flood zones may not be top of mind when shopping for a home, but it is something that must be considered. Your mortgage lender may require that you have flood insurance if you live in a FEMA designated flood zone. These are areas that have a higher than normal risk of flooding.
If you are considering a home near a body of water, it is worth investigating what areas are considered a flood zone. You do not want to plan for this home insurance addition into your budget after you purchase your home.
Flood Insurance Can Be Valuable Outside of Flood Zones
Think your home is safe because you are outside of a flood zone? Your home may be more at risk than you think. Flood insurance can help protect your home if any sort of water enters your home, including rainwater.
For example, there may be a very heavy rain storm that causes the water to start backing up into the street. If that water eventually inches its way towards your home and enters your basement through your window wells, then you will have insurance coverage through flood insurance. This is something to pay attention to if your home is at the low part of elevation on your street.
Flood Insurance Has Limitations
Many homeowners throw around the word flood when dealing with water damage. They may say that their basement flooded when a pipe burst and caused water to drain into a basement. Another problem is saying a basement flooded when water backed up from the local sewer system into your home.
This type of damage may be water related, but it is not considered flooding. A burst pipe may be covered under your basic homeowners insurance policy, and sewage would need coverage under a separate sewer backup policy. If you are worried about these two things happening to your home, know that a flood insurance policy won't cover them.
Speak with a local home insurance agent to find out what kind of policy you need to meet your needs. For more information, contact a service like Lanham Insurance Agency.