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Does my homeowners
insurance cover
flooding?
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Standard
homeowners
policies do NOT
cover flooding.
You can purchase
flood coverage
directly through
your homeowners
insurance agent.
However, the
policy is
provided by the
Federal Flood
Insurance
Program (
888-379-9531,
http://www.floodsmart.gov
).
Replacement
cost
coverage is
available for
the structure of
your home, but
only actual
cash value
coverage is
available for
your
possessions.
Replacement cost
coverage pays to
rebuild your
home as it was
before the
damage. Actual
cash value is
replacement cost
coverage minus
depreciation so
that the older
your possessions
are, the less
you will get if
they are
damaged. There
may also be
limits on
coverage for
furniture and
other belongings
stored in your
basement.
Flood insurance
is available for
renters as well
as homeowners.
You will need
flood insurance
if you live in a
designated flood
zone. But
flooding can
also occur in
inland areas and
away from major
rivers. Consider
buying a flood
insurance policy
if your house
could be flooded
by melting snow,
an overflowing
creek or pond or
water running
down a steep
hill. Don’t wait
for a flood
season warning
on the evening
news to buy a
policy—there is
a 30-day waiting
period before
the coverage
takes effect.
The federal
flood insurance
program provides
only limited
coverage. If you
need more
coverage than
the federal
program
provides,
additional
coverage known
as “excess”
flood insurance
is available
from specialized
insurance
companies.
Depending on the
amount of
coverage
purchased, an
excess flood
insurance policy
will cover
damage above the
limits of the
federal program
on the same
basis as the
federal
program—replacement
cost for the
structure and
actual cash
value for the
contents.
Excess flood
insurance is
available in all
parts of the
country—in high
risk flood zones
along the coast
and close to
major rivers as
well as in areas
of lower
risk—wherever
the federal
program is
available. It
can be purchased
from specialized
companies such
as Lexington
Insurance
Company, part of
American
International
Insurance
Company, and
Lloyd’s through
independent
insurance
agents, or from
regular
homeowners
insurance
companies that
have
arrangements
with a
specialized
insurer to
provide coverage
to their
policyholders.
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