Adam Dow Real Estate

What every buyer needs to know

Buyers Guide

What to Know About Flood Insurance

 Flood Insurance: Understanding the Basics

Flooding is the most common and costly natural disaster in the United States

  • There is NO coverage for flooding under a standard homeowner or renters policy or most commercial policies

  • Flood insurance can only be purchased through an insurance agent; you cannot buy it directly from the federal government


Flood policies will cover:

  • Residential buildings up to $250,000 and non-residential buildings up to $500,000

  • Residential contents up to $100,000 and non-residential contents up to $500,000

  • Excess flood coverage may be available through the private sector


Flood policies will NOT cover:

  • Damage caused by moisture, mildew or mold that could have been avoided by the property owner

  • Currency, precious metals, and valuable papers

  • Property outside, such as trees and plants, wells, septic systems, decks, fences, pools, hot tubs, etc.

    Living expenses such as temporary housing

Flood Insurance: The New Requirements

What are flood insurance premiums based on?

  • Flood insurance premiums are based on a number of factors:

    • Age of the property

    • Style of your home’s construction

    • The elevation of a structure in relation to the Base Flood Elevation (BFE). The BFE is the elevation where there is a 1% or greater annual chance of flooding.

  • For properties in high-risk zones, you must get an Elevation Certificate in order to determine the full risk premium.

  • Elevation Certificates are required for property in high-risk zones.


What is an Elevation Certificate and how do you get one?

  • An Elevation Certificate is a form completed and signed by a licensed engineer or land surveyor

  • There are a series of measurements needed to determine your home’s “lowest floor” in relation to the BFE

  • If you are buying from a previous owner, check with them to see if they have an Elevation Certificate. The certificates remain valid, regardless of age, as long as there have been no significant changes/improvements made to the property. You can also call a local surveyor or engineer to request an Elevation Certificate for your property.


Is there a waiting period before Flood Insurance goes into effect?

  • Typically, there is a 30-day waiting period from the date of application before your policy goes into effect. There are very limited exceptions.


How much does Flood Insurance cost?

  • Rates are set and do NOT differ from company to company or agent to agent

  • Higher deductibles can lower your premium; deductibles apply separately to buildings and contents


Are there mandatory requirements regarding purchasing flood insurance?

  • Homes and businesses with mortgages from federally regulated or insured lenders in high-risk flood areas are required to have flood insurance

  • Lenders can require flood insurance even if it is not federally required



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