Does your homeowners insurance policy cover flood damage? The answer is most likely “no”. The vast majority of flood insurance is written separately through the National Flood Insurance Program (NFIP). The NFIP is managed by the Federal Emergency Management Agency and writes or renews flood insurance for 5.6 million property owners nationwide. It’s important to know that a lender will require a home in a flood zone have flood insurance before it will write a loan.
Flood insurance protects two types of insurable property:
• The insured building and its foundation
• Electrical and plumbing systems
• Central air conditioning equipment, furnaces and water heaters
• Refrigerators, cooking stoves and built-in appliances, such as dishwashers
• Permanently installed carpeting over unfinished floors
• Clothing, furniture and electronic equipment
• Portable and window air conditioners
• Portable microwaves and dishwashers
• Carpeting that is not already included in property coverage
• Clothing washers and dryers
It’s also important to know that, unless you’re getting flood insurance the day of a home closing, there’s a 30 day waiting period for the coverage to start. This is to prevent a stampede of homeowners from applying for insurance when severe weather (i.e. hurricane) threatens an area.