Do I need flood insurance?

You may have heard of flood insurance and wondered if you really needed it. To decide if flood insurance is right for you, it's important to understand a little bit about flood and insurance.

Floods are the first natural disaster in the United States, according to the Federal Emergency Management Agency (FEMA). Even a few inches of water can be expensive for your home and its contents, says FEMA.

Many conditions can cause flooding - spring thaw, heavy rain, hurricanes, and rapid rain buildup after a forest fire are just a few. And although some areas are affected by the floods, it can happen anywhere, anytime.

Here are some things to consider when deciding to purchase flood insurance.

Home insurance generally does not cover floods

It is important to know that standard home insurance does not generally cover damage due to flooding. And since flooding can happen anywhere, you need to purchase separate flood insurance. Flood insurance is purchased through the National Flood Insurance Program (NFIP), which is managed by FEMA or may be sold by certain private insurers.

What does flood insurance cost?

The price of flood insurance is based on a number of factors, including the risk of your property flooding, the policy coverage, and the insurance coverage you purchase. According to FloodSmart.gov, you can purchase separate coverage (typically up to $ 250,000) for the structure of your home and property (up to $100,000). The type of coverage you buy and the limits you set determine the price of your policy.

WHEN IS FLOOD INSURANCE REQUIRED?

If your home falls into a high-risk flood zone and you have a mortgage from an insured or state-regulated lender, your lender is required by law to require flood insurance, says FEMA. This is generally not the case if your home is in a medium to a low-risk area. However, a lender can apply for flood insurance at any time, even if the company is not legally required to do so according to FEMA.

To take out NFIP flood insurance, your municipality must participate in the program. Most municipalities participate, but not all municipalities in the country. You can check if your community is participating in the NFIP Community Status Book (click on your status and search the alphabetical list of communities to see if your community is listed).

Although flood insurance is offered through NFIP, private insurance companies sell and manage the policies. Most policies will take effect 30 days after they are signed. So it's a good idea to consider purchasing a blanket before the start of the storm season. Find a representative near you to discuss your flood insurance needs.