Your New Flood Insurance Might Cover a Lot Less Than You Think!

If you’ve been watching the news and seeing the damage that Hurricane Irene and other natural disasters have brought to this country, you might be thinking about flood insurance. The National Flood Insurance Program is one of the most widely known insurance policies that actually covers flood, but you can also find private insurance groups that would be more than happy to extend you a policy — as you long as you can understand the fine print, of course.

The trouble with a lot of insurance policies and the disputes that often follow is that everything is good when you get the policy, but when you actually go to file the claim …things can get sour in a hurry. For example, you might not realize that your basic flood insurance policy only covers the damage to a home that starts above the ground floor. So the first floor of your home would naturally be taken care of, but the basement would be left out. That’s a lot of damage that you would have to cover out of pocket, which could definitely make life really difficult for you. The better thing to do would be to make absolutely sure that you know exactly what your insurance policy will cover in the event of flood.

Keep in mind that the more bells and whistles you request, the higher your premiums will be. Also, if you have a history of challenged credit, your premiums will also go up. One of the things that people hate about the insurance world is that the victors are usually the ones that look like the least amount of risk. So even if all of your previous insurance claims were valid, your insurance company is going to find you much more risky than someone that has never filed an insurance claim. It’s a process that turns people into numbers rather than individuals, but it is what it is.

That’s why you need to flex your power at the moment of truth — before you actually sign off on a new flood insurance policy. Look at a comprehensive policy that would cover not only mechanical equipment in your basement, but any carpeting, furniture, other flooring and even fixtures. These are the things that you will have to actually ask for and make sure that they are in your policy.

National Flood Insurance coverage is going to be very limited on items in your basement — very limited to only the essential items required to runt he house. So the water heater is something that’s going to be replaced, but the old sofa that you were storing down there isn’t going to be covered.

The federal program covers $250,000 towards rebuilding the home and 100,000 in contents.

A policy is only as good as the payer makes it — in other words, once you get your flood insurance and all of the supplemental policies that go with it, you’re going to need to make sure that you stay on top of the premiums. You cannot let any of the monthly or annual premiums lapse, or the policy will be cancelled. if you need to make arrangements because you’ve had a run of financial problems, that’s something that you’re going to have to work out with your insurance company.

It’s definitely worth it to look into flood insurance. Now that you have more information about the process, you can make even better decisions — get started today!