Flood insurance is clearly a necessity when you are living right up near bodies of water. But if it rains, your home that is miles from water can become a flood risk and flood damage is NOT covered by your homeowners/renters insurance. Floodsmart.gov has a nifty tool that can estimate the cost of flood damage for a variety of flooding levels. Using their “Cost of Flooding” tool the loss estimate for just three (3) inches of flooding in a 1,000 square foot home is 11,000+ and THIS IS NOT COVERED UNDER your homeowners/renters policy. Without flood insurance, this would be your expense. OUCH!
Based on your location and flood history there are two categories of flood insurance:
Standard Flood Insurance – these policies are for buildings located in the National Flood Insurance Program (NFIP) defined “flood zones” which are categorized based on proximity to water sources and flooding history. This insurance is available in communities that voluntarily participate in the NFIP by having adopted and enforcing flood plane management requirements to reduce future flooding issues. This could include restrictions on how close to bodies of water buildings can be constructed as well as requirements on minimum heights of the first floor of a building (i.e. requiring homes at the beach to be built on stilts at a minimum height).
Preferred Risk Flood Insurance – these policies are for homes and businesses that are considered a low to moderate risk for flooding. These policies are offered at a lower cost as a “preferred risk”
Flood Cost Estimator