| Far too many homeowners are under the erroneous | | | | buildings and contents. The land your buildings or |
| belief their homeowner insurance covers flooding. This | | | | contents occupy is not covered. You can not insure |
| simply isn't true. If you live in an area prone to | | | | land. |
| hurricanes, tropical type storms, heavy rains and other | | | | According to the NFIP, building coverage includes the |
| watery weather conditions, flood insurance would be a | | | | insured building and its foundation, the electrical and |
| wise investment. | | | | plumbing system, central air conditioning equipment, |
| The National Flood Insurance Program (NFIP) was | | | | furnaces, water heaters, refrigerators, cooking stoves, |
| created by Congress in 1968. The purpose was to | | | | built in appliances and permanently installed carpeting |
| provide a means for property owners to financially | | | | over unfinished flooring. |
| protect themselves in the event they experienced a | | | | The NFIP says clothing, furniture, electronic equipment, |
| flood. | | | | curtains, portable and window air conditioners, portable |
| The program isn't for home owners only. It covers | | | | microwaves and dishwashers, carpeting that is not |
| renters and business owners as long as their | | | | already included in property coverage and clothing |
| community participates in the NFIP. This means the | | | | washers and dryers are included under contents |
| participating communities have agreed to adopt and | | | | coverage. |
| enforce ordinances that meet or exceed FEMA | | | | If you have a flood claim, you will be reimbursed in one |
| requirements to reduce the risk of flooding. | | | | of two methods. The first is called Replacement Cost |
| The reason the community adopts FEMA | | | | Value (RCV) and the second is Actual Cash Value |
| requirements is that FEMA administers the NFIP. The | | | | (ACV). |
| FEMA rules are not overly burdensome to the | | | | The RCV is the cost to replace damaged property. It |
| community. They have to first join the NFIP and | | | | is reimbursable to owners of single-family, primary |
| enforce sound floodplain management standards. | | | | residences insured to within 80% of the building's |
| Flood insurance is not purchased through FEMA or the | | | | replacement cost. |
| NFIP. Rather, consumers purchase this coverage | | | | All other buildings and personal property (i.e. contents) |
| through property and casualty (PC) insurance agents. | | | | are valued at ACV. The ACV is the RCV at the time |
| Neither the agents nor the participating insurance | | | | of loss minus physical depreciation. Personal property |
| companies can set their own rates. | | | | is always valued using the ACV. |
| Flood insurance rates depend on many factors. The | | | | Flood insurance can seem complicated so it is wise to |
| most obvious are the date and type of construction of | | | | have the agent answer all of your questions. If you |
| your home coupled with your building's level of risk. | | | | have to, go over each coverage until you understand |
| This tells you flood insurance coverage protects both | | | | what is and is not covered. |