When you're closing on a new house, there are a lot of little details to think about. One of the ones that many new homeowners often overlook is that of flood insurance. While mortgage lenders may require flood insurance of some borrowers, it may not be required of all depending on the flood zone the home is in. In addition, if you pay cash for the house, it's up to you to decide if you're going to opt for flood protection. Here are a few things you should know about flood insurance before you decide.
You Don't Have To Live In A Flood Zone To Get Insurance
It is a commonly held belief that you can only obtain flood insurance through FEMA if your home is in a flood zone that is at some degree of risk. Even if you live in an area that has little to no flood risk, you can still buy flood insurance, and you should. There's no telling when the neighboring county's dam might fail and flood your area. You want to know that your home is protected if something like that happens. The good news is that, since flood insurance is rated by the degree of risk, living in a low-to-no risk area may lead to cheaper flood insurance.
Flood Insurance Has Its Limits
When you're looking at a flood insurance policy through FEMA, it's important to understand the policy limits. Most federal flood insurance policies have a limit of total coverage for the home structure and your possessions, so you'll want to be sure that you know exactly how much your policy will pay for a loss. That way, you can seek out supplemental flood insurance if you have more than the policy will cover.
In addition, you'll want to note that flood insurance policies don't cover your housing costs for any time you have to spend in a hotel or otherwise while you're waiting for repairs due to covered flood damage. You'll want to talk with your insurance company about what kind of supplemental policy will help you cover those costs as well.
When it comes to flood coverage, every home should have protection. Even if you don't think that your home is at risk of flood, the unexpected can always occur. Talk with a local insurance carrier like Heritage Insurance Agency today to see what kind of coverage is available for you before you close on that home.