What is flood insurance?
Flood insurance is an insurance that protects homeowners from losses associated with floods. Flood insurance is very important especially when the property is located in a flood zone. Homebuyers can tell if the property is in a flood area by checking their property tax records. Real estate agents can also help you evaluate the location of the property.
The easiest and best way to know if a property is in a flood zone is to use FEMA’s flood map. By typing the address into the search box, you will be able to know if the house is located in a flood zone right away.
What does the flood insurance covers?
In summary, flood insurance will cover your house and your belongings. According to floodsmart.gov, there are two types of coverages of food insurance which are building coverage and content coverage.
Building coverage
The building coverage will focus on the damages related to the building itself such as the following:
- Electrical systems
- Plumbing systems
- Water heaters and furnaces
- Refrigerators, built-ins appliances, stoves
- Staircases, paneling, cabinets, foundation walls
- Fuel tanks, energy equipment
- And many more
Contents coverage
The contents coverage will cover the belongings of the homeowners as shown below.
- Clothes, furniture
- Electronics, microwave oven, washer and dryer
- Art such as painting, scriptures, etc.
- And many more.
Buying a house in a flood zone
Investing in a property located in a flood area can be terrifying. You will never know when disasters will strike and how much damage they will cause.
Because of this reason, mortgage providers require homebuyers to purchase flood insurance before the mortgage approval. This insurance must stay active until the mortgage is fully paid off or until the house is sold to another buyer who will then get flood insurance under their name.
Homebuyers should also consider all the risks involved with buying a house in a flood zone. Not only that you will purchase the flood insurance but also you will be exposed to a lot of danger that can result in property damages or death in some cases.
