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The Curious Bag
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Flood insurance is a type of insurance policy that covers damage to a home caused by an overflow of water brought on by a natural disaster. It is a federal plan backed by the National Flood Insurance Program (NFIP) and is available to homeowners, business owners and people who rent.
Coverage
The NFIP covers up to $250,000 of flood damage caused to a home. It covers damaged furnaces, water heaters, air-conditioners and floors, structural damage and the cost of cleaning up debris.
Limitations
Basic flood insurance does not cover damage caused to the contents inside of the home, such as sofas, clothing, wall decorations and other personal items. Purchase special flood insurance to cover damage to these items.
Cost
According to the National Association of Insurance Commissioners, an average flood insurance policy costs $500 annually.
Eligibility
According to HelpWithMyBank.gov, people are eligible to purchase flood insurance if they live in a community that has an agreement with the federal government to make flood insurance available.
Time Frame
Flood insurance goes into effect 30 days after purchase.
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