Don’t Be Up a Creek Without A Paddle. Buy Flood Insurance.

December 15, 2007 By Matthew Paulson

What would you do if you came home from a trip to find your entire home sitting in a pool of 3 foot of water? Would you have the money to pay for it? Would you lose some of your most prized possessions? If you live in a flood plain, it’s just not a chance worth taking. Buying flood insurance is absolutely critical to preventing a five-figure financial emergency.

When it comes to flooding, your standard homeowner’s insurance policy will likely not cover any damages. A specific flood insurance policy will cover things like damages tom major appliances including your furnace, air conditioner, water heater, and the like. It will also cover any structural damage that was done to your home, cleanup of debris, and damages to your flooring. Some policies will cover the loss of your personal possessions and some will not, so make sure you find one that will cover your belongings in the event of a flood.

How do you know if you need flood insurance? FEMA has done the statistics and identified whether or home is likely to flood and your mortgage company will use that information to determine if you should be required to have flood insurance. They identify areas that are very likely to flood as “Special Flood Hazard Areas.” If an area has a 1% chance or higher risk of flooding a year, it’s designated as high risk. You will want to buy flood insurance if you live in these areas even if your mortgage company does not require it.

Your mortgage company will likely be able to tell you whether or not you live in one of these zones. Alternatively, FEMA offers a service that will allow to search your address online any they will tell you whether or not you live in a high-risk flooding area. You can find that website at http://www.floodsmart.gov/

Another type of insurance might just seem like another bill to pay each month, but it is well worth it. A major flood can be financially and emotionally devastating; it’s just not worth taking the risk.

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