Many first-time homeowners in Phoenix are surprised to learn that their homeowner insurance policies cover very little or nothing at all when it comes to the flooding of their homes. If you want that protection or perhaps need it because you live in a high-risk zone, then you need a distinct flood insurance policy.
1. National Flood Insurance Program
Most of the flood insurance policies sold in the United States are administered by major insurance providers but actually backed by the National Flood Insurance Program. The NFIP was established in 1968 in order to ensure that property owners could get flood insurance if they wanted it. There are two distinct policies available, and you can have both or one or the other. The first policy provides protection for your building up to $250,000 and the other for your personal property up to $100,000.
2. Building Property Coverage
This policy is meant to cover the primary building itself, and it will compensate you with the actual value or the cost to rebuild depending on which amount is lower. Coverage extends to the home and its foundation but also systems that are deemed integral. These integral systems include electrical, HVAC, kitchen appliances, plumbing, hot water heaters, permanent carpeting and flooring and so forth.
3. Personal Property Coverage
This policy is meant to protect what is in the home and important to you but not covered by the categories above. This includes furniture, consumer electronics, washers and dryers, clothing and even frozen food if it was in a freezer within the home or an attached/detached garage. It will also cover up to $2,500 in valuables, and all property is compensated for based on actual values rather than what you paid.
4. Limited Protection for Basements
The NFIP provides less protection for your basement and any contents contained within. This reduced coverage extends to crawl spaces as well as any floor of the home fully or partially below ground level. It will cover cleanup, but covered equipment is limited to sump pumps, furnaces, oil tanks and so forth.
5. What Is Not Covered
Your NFIP-back policy will likely not cover anything that is covered by your homeowner insurance policy. Although it will cover physical valuables, this protection does not extend to cash, bank notes and so on. It will cover a detached garage up to a percentage of the homeowner policy, but it will generally not cover landscaping, decks, driveways, vehicles and so forth.
If you’ve experienced water damage in Phoenix AZ caused by a flood, call our professionals today!