Preferred Risk Policies
Know If You Need Flood
If you are applying for a mortgage for a home in an ‘A’, ‘AE’, or ‘V’ zone, your lender will require you to purchase flood insurance as a condition of closing. Your flood insurance rates (“what you will pay”) are typically determined by many factors such as, (1) the amount of coverage on the policy, (2) the age of your home, (3) the elevation of the house (determined by a survey and an elevation certificate using an engineering company), and (4) the Deductibles on the policy.
What is Covered by a Flood Policy
Flood is not a covered loss under your standard homeowners/hazard policy.
To be insured for a flood loss, you will need to purchase a flood policy. A standard flood insurance policy is a single-peril policy (flood) that pays for direct physical damage to your insured property up to the lesser of the replacement cost, or actual cash value of the actual damages or the policy limit of liability.
Physical damage to your building or personal property “directly” caused by a flood. For example, damage caused by a sewer backup are covered if the backup is a direct result of flooding. If the backup is caused by another source, it is not covered.