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Why Purchase a Home Flood Insurance

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By : Sonia Smith    99 or more times read
Flood insurance is separate from your regular homeowner’s insurance. It is an insurance provided by not so many insurance companies and has it s own terms and pricing. This kind of insurance is not necessary for every homeowner but important for those who live in a flood-designated zone and has home mortgage. The areas designated by the government are those near main oceans, rivers and other dangerous flooding zones. For those living far from bodies of water, a flood insurance policy is available but optional. Nevertheless, if your home has a history of flooding due to the smaller ponds or creeks nearby, snow melts and excessive rainfall, it would be a good idea to purchase one.

Bear in mind that while floods can cause a major destruction, the damage it brings is not covered by a regular homeowner’s insurance. A home flood insurance offers the special coverage that you need to protect your home and belongings against rising waters. Furthermore, flood insurance covers structure damage, water heater, rugs, furnace, appliances, furniture, clothing in the basement area; expenses incurred from protecting your home against flood damages such as sandbagging and cover the cost after a flood, which includes removing debris.

Flood insurance for your home is not as costly as you think. The coverage benefits definitely outweigh the cost or replacements and repairs. Homes that are located in low to moderate risk areas may be eligible for a PRP or Preferred Risk Policy, which is a low cost option that allows homeowners and business owners protection from the effects of flooding. You can purchase a flood insurance policy for your home through the NFIP or the National Flood Insurance Program and other private organizations. The government backs most private companies that provide flood insurance. When you purchase a policy from a private organization, it is very important to find out its financial strength and its reputation so you can be certain that it is still around when you file a flood claim.

The price of a flood insurance is based on the number of policies you purchase. Typically, there are certain maximum amounts that are available to replace home structure and personal belongings. Furthermore, it also depends on whether you purchase replacement cost insurance or actual cash value. A replacement cost insurance pay for a claim on rebuilding your home similar to what it used to be before the flood damage while the cash value insurance replaces property and possessions less the value of depreciation.

Another important thing to take into consideration when buying a flood insurance is an excess insurance. If your home and belongings is worth more than the maximum amount of a regular insurance, you can opt to pay more coverage such as the excess insurance. It is good to check out the financial strength of the insurance company for your excess coverage and also the insurance rate. In general, it takes thirty days after purchase before the policy is effective. Therefore, it is necessary to plan ahead and buy a home flood insurance as soon as possible.
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