Flood damage is a major concern for homeowners, condos, and renters. While standard home, auto, or property insurance may cover some water damage, a separate flood policy is usually required for homes in high-risk areas.
Homeowners, condos, and renters can buy flood insurance through the NFIP or private insurers. Private insurers typically offer more coverage options and fewer exclusions.
What is Flood Insurance?
Georgia flood insurance is a type of homeowners or renters insurance that covers damage to property from flooding. It’s available through the National Flood Insurance Program (NFIP) and private insurers. Mortgage lenders often require it for people in high-risk zones, and the federal government offers grants and other aid to help them pay for it.
Most standard home and rental policies don’t cover flood damage, and NFIP policies are designed to fill the gaps. Whether or not you need flood insurance depends on where you live and how much the value of your possessions is. Most NFIP homeowners policies are Preferred Risk Policies, which offer coverage for homes in moderate- to low-risk areas at lower premiums than traditional NFIP policies.
Regardless of your location, consider getting an NFIP policy just in case. Having one can be a smart financial move, especially since most flood claims come from communities outside of high-risk areas. You are taking a home inventory, and learning what items your policy covers can help you determine how much building and content coverage to buy.
What Does Flood Insurance Cover?
Standard homeowners insurance won’t cover flood damage. If you live in a flood zone or near a body of water, consider filling this coverage gap with a policy from the National Flood Insurance Program (NFIP) or private insurers.
NFIP policies typically provide building and contents coverage for up to $250,000 per dwelling, with an additional limit of $100,000 for the content of non-residential buildings like a garage or shed. The cost of the policy varies, depending on factors including the building’s location, how close it is to a body of water, and the severity of previous flooding in the area.
The NFIP also offers a preferred risk policy, which provides up to $250,000 of building and contents coverage for moderate-to-low-risk properties for one price. Private insurance companies offer similar policies, with options for more comprehensive coverage and fewer exclusions. Unlike the NFIP, private insurers often allow you to add a flood policy to your existing homeowners or auto policy, and their policies are generally tax-deductible.
How Much Flood Insurance Do I Need?
Flood damage is responsible for many of the highest costs associated with natural disasters, and even a single inch of water can cause thousands of dollars worth of damage. Homeowners and prospective homebuyers must take the time to understand what flood insurance covers and how much it might cost so they can make the right decision.
Private flood insurance companies can offer different policy lengths and higher limits, such as up to $4 million for the structure and $100,000 for contents. To determine how much personal property coverage you need, it’s helpful to create a home inventory that includes a description and the price of each item.
How Does Flood Insurance Work?
Flooding is nature’s most common natural disaster, and just one inch of water can cause $25,000 worth of damage. Since standard homeowners and renters insurance policies do not cover floods, you need a separate policy to protect your property from loss from this peril.
The National Flood Insurance Program (NFIP) offers homeowners, renters, and businesses building and contents coverage. The cost of the policy depends on factors like how close your home is to a body of water, its flood zone designation, and its elevation.
The NFIP provides building coverage up to $250,000. It also covers personal property on an actual cash value basis, meaning you will get back only what your items were worth when the flood occurred. The NFIP requires you to pay a deductible before it starts to pay on a claim. Some states allow you to put money into Catastrophe Savings Accounts that can be used for emergency repairs in the event of a flood. However, you will have to pay taxes on the money if it’s spent on anything else.
What Should I Do If I Have a Flood Claim?
A reputable insurance agent can help you assess your home’s flood risk and decide whether or not a flood policy makes sense for your family. You can also find information on the National Flood Insurance Program and its partners’ websites, including a handy tool to determine your home’s likely flood risk.
If you have a flood claim, contact your insurance company and file a report immediately after the damage. Take lots of photos and make an inventory of your damaged items, if you can, with details such as brand names and model numbers (especially for large appliances). Make sure to save receipts, bills, and other documents that document the value of your belongings. It’s important to know that NFIP policies pay only for replacement costs or the actual cash value of damaged contents.
If you disagree with the adjuster’s assessment of your losses, consult an experienced public adjuster or speak to your legislators. How you deal with your homeowners and flood insurers can significantly impact your ability to rebuild or replace your life after a storm.
