What exactly is flood insurance?
Flood insurance is a type of insurance that covers damage caused by floods. Flooding can occur due to a variety of reasons, such as heavy rainfall, overflowing rivers or oceans, storm surges, snow melt, and blocked storm drainage systems.
Flood insurance policies are typically offered through the National Flood Insurance Program (NFIP), which is a federal program that provides flood insurance to homeowners, renters, and businesses in participating communities. Flood insurance policies can also be purchased through private insurers, but these policies may have different coverage options and premiums.
Flood insurance typically covers damage to the structure of the home or building, as well as its contents. This includes damage to walls, floors, ceilings, electrical systems, plumbing, heating and air conditioning systems, appliances, furniture, and personal belongings. However, there are certain exclusions and limitations to what is covered under flood insurance, such as damage caused by sewer backups, moisture or mold that could have been prevented, or loss of income due to business interruption.
It's important to note that flood insurance is typically not included in a standard homeowners insurance policy and must be purchased separately. If you live in a high-risk flood zone, your mortgage lender may require you to purchase flood insurance as a condition of your loan.