INDUSTRY INSIGHT
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5 Myths About Flood Insurance
When you buy a house everyone knows to protect it with home insurance , but unless required by their bank at closing , most people neglect to purchase flood insurance . In fact only 12 % of homeowners in the United States have a flood policy . Why is this number so low ? It may have less to do with choice and more with regard to confusion about flood insurance eligibility and coverage .
Myth 1 : I have to be in a flood plain to get coverage .
This is the most common misconception about flood insurance and is completely incorrect . Flood coverage is available to those in moderate to low-risk areas as well as highrisk areas , and sometimes at a lower cost . A flood can occur anywhere ; in fact one-fourth of all flood claims come from lower risk locations .
Myth 2 : My homeowners policy will take care of it .
Flood coverage , which is defined as groundwater coming into a house , is never covered under a standard homeowners policy . This can be confusing , since water damage can be covered by homeowners insurance , but it has to occur via a burst pipe or stormwater coming into the house through a damaged roof . Water from a sewer drain backup is not covered either , but can be added to a home policy for an additional cost . Flood coverage , however , cannot be added and has to be purchased on a separate policy .
Myth 3 : My house has been flooded before ; I can ’ t get coverage now .
This is untrue . Although there is always a 30-day waiting period for coverage to take effect , a home that has been previously flooded can be covered under flood insurance as long as it meets standard eligibility requirements .
Myth 4 : Flood coverage won ’ t cover my personal belongings .
Coverage for personal property inside your home is available , up to a limit of $ 100,000 . There are limitations for items stored in a basement , however ; in basements with four walls completely underground , personal property coverage is excluded .
Myth 5 : Flood coverage is only available for those who own a home .
Flood coverage is not limited to homeowners only . If you rent , you can obtain coverage as well . It ’ s also available for non-residential buildings , so business owners can cover their buildings and property under the national flood program too .
This INdustry INsight was provided by The Bill Flinn Agency .
For the last 40 years The Bill Flinn Agency has been serving the Bethel Park and South Hills communities . Since opening our doors in 1972 our mission has been to treat our customers by the golden rule . Learn more about us at www . billflinnagency . com , or stop by our office on South Park Road in the heart of Bethel .
What else should I know about obtaining a flood policy ? The National Flood Insurance Program ( NFIP ) has some specific rules that are important to know if you are looking to purchase coverage . This first , which was touched upon earlier , is that there is a 30-day waiting period after purchasing coverage before it takes effect . This is important to know in the case of purchasing a new home , as you will need to make sure to buy the coverage at least a month before your closing date . However , if the home loan requires flood insurance , this waiting period is usually waived . Despite flood policies being available from a number of insurance companies , the premiums will always be the same , since they are set by the NFIP . However , the yearly premiums must always be paid in full , as this is a requirement of the NFIP and there is no getting around it no matter what company you write with . Finally , elevation certificates may need to be obtained during the process at an additional cost .
So if you are concerned about protecting your home or business against the ravaging effects of flood damage , the next step is to call an independent insurance agent to advise you further and guide you through the process . We at the Bill Flinn Agency are here to answer any questions you may have , so give us a call at 412.833.5351 .
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Bill Flinn Agency Inc
2754 S Park Rd Bethel Park , PA 15102-3858 www . billflinnagency . com
412-833-5351
ERIE ® life insurance products and services are provided by Erie Family Life Insurance Company . Information regarding additional terms , conditions , exclusions , licensure and territory information is available at erieinsurance . com / life . Eligibility for insurance coverage will be determined at the time of application , based upon applicable underwriting guidelines and rules in effect at that time . S1603 5 / 14 © 2014 Erie Indemnity Company
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