Floods are dangerous, destructive events that can be financially devastating. In fact, just one inch of water inside a home or building can result in many thousands of dollars in damage.
Homeowners often turn to an insurance company following unexpected damage to their house and personal belongings. Many are under the false impression that insurance covers all losses. In reality, homeowners insurance is a legal contract that outlines what is and is not covered. Losses that are not covered are called 'exclusion.' Flood-related damage is among the exclusions found in standard homeowners insurance policies.
Insurance protection is available for flood damage, but only as a separate, stand-alone policy. Coverage is available through the National Flood Insurance Program as well as a few private insurers. Your local homeowners insurance agent can provide cost and coverage details. Basics to keep in mind:
Victims without flood insurance have few options to pay for damage. A low interest loan (which must be paid back) may be available if the flood area receives a Presidential Disaster Declaration. Victims may qualify for a FEMA disaster grant, but the amount will likely be far less than the cost of repairs. More often, flood victims pay for repairs and replacing personal belongings out of pocket.