Your home insurance probably will not cover any type of flood damage. To be clear, a flood is NOT water that comes from inside of your home from a broken pipe or leaky dishwasher. A flood is from external, natural running water that enters your home, either from rainfall, standing or running water or even from underground.
Home insurance typically excludes flood damage to both your
home and your belongings. Occasionally, there could be some coverage provided
if the actual flood damage was preceded by another event that allowed the flood
damage to happen. For example, if wind blew out your windows, allowing the rain
to enter your home or (with some companies) if your sump pump fails and allows
water to enter through your basement, there MAY be coverage. However, coverage
for flood damage under your normal home insurance is rare and should not be
relied on.
Insurance companies
typically provide flood insurance through the National Flood Insurance Program.
In 1968, Congress created the National
Flood Insurance Program (NFIP) to help provide a means for property owners to
financially protect themselves. The NFIP offers flood insurance to homeowners,
renters, and business owners if their community participates in the NFIP.
Participating communities agree to adopt and enforce ordinances that meet or
exceed FEMA requirements to reduce the risk of flooding. El Paso county
and most of Colorado participate in the NFIP.
Does the National Flood Insurance Program cover
everything that happens to my home and belongings if it is flooded? Unfortunately, not, but it does cover a lot.
For homes that do NOT have a basement, most of your home and contents should
all be protected by your flood insurance policy (up to the coverage limits that
you purchase). However, things work differently if your home DOES have a
basement. Here is what is and isn’t covered, according to the NFIP:
“Flood insurance covers
your home's foundation elements and equipment that's necessary to support the
structure (for example: furnace, water heaters, circuit breakers, etc.). It's important to note that some items in your basement
are covered under building coverage (like a furnace, hot water heater and
circuit breaker) and others are covered under contents coverage that must be
purchased in addition to building coverage (for example, your washer and dryer,
or your freezer and the food in it). The NFIP encourages people to purchase both building and
contents coverage. Flood insurance does not cover basement improvements, such
as finished walls, floors, ceilings or personal belongings that may be kept in
a basement.”
Is
flood insurance expensive? It depends. If your property is not in an actual
flood zone, it would qualify for a Preferred Risk Policy. Preferred Risk
Policies cover everything that a regular policy covers but at a substantial
discount. Most homes in El Paso county (but not all) qualify for a Preferred
Risk Policy. Depending on your coverage choices, a Preferred Risk Policy will
cost between $130 - $460 per year.
If, however, your
home lies within a flood zone, flood insurance prices will vary dramatically.
There are 26 different flood zone levels, each with its own insurance rates. The
higher the flood zone, the more likely the property is to experience a flood
and the more expensive the flood insurance will be. Can I start my flood insurance right before a storm starts? Unless you are required to have flood insurance for a home loan closing, there is a 30 day waiting period before coverage begins on flood insurance policies. The time to buy your flood insurance and get the coverage for your property is 30 days (or more) before the rain clouds gather above your home!
To find out if you’re property is in a flood zone or to get a flood insurance proposal, contact our office at 719-685-8585 and we’ll be happy to help.