Doing Away with Flood Insurance Myths

When you purchase flood insurance you gain a certain degree of peace of mind. Flooding is a very common occurrence in the United States. It is for this reason that both State and federal officials desire to make sure that all state residents know about the benefits of the National Flood Insurance Program (NFIP).
The following are common myths and misunderstandings with regard to flood insurance.
Myth #1: You have to be a homeowner to purchase flood insurance.
FACT: In communities that are a part of the National Flood Insurance Program, you can be a homeowner, condo unit owner, renter, or business to purchase flood insurance. The maximum amounts of coverage are:
• For those who own condominiums: as much as $250,000 in structural coverage and up to $100,000 in contents coverage
• For those who rent: as much as $100,000 in contents coverage
• For businesses: as much as $500,000 in commercial structural coverage and as much as $500,000 in contents coverage
Myth #2: Those living in areas that are high risk cannot buy flood insurance.
FACT: National Flood Insurance is available no matter where you live, assuming that your community participates in the program. The NFIP was first introduced in 1968 with the purpose of making federally backed flood insurance available to property owners, renters, and businesses.
Myth #3: Those living in unmapped area do not need flood insurance.
FACT: Portions of unmapped flood zones are still susceptible to flooding, although to a lesser degree. You should definitely carry flood insurance if you live in a mapped flood zone. Nevertheless as much as 20 and 25 percent of the NFIP's claims derive from outside mapped flood zones. Those living in residential property or those owing businesses located in unmapped zones should contact their insurance agents to see if they are eligible for a Preferred Risk Policy with special low rates.
Myth #4: If you have had prior folding insurance is not available to you.
FACT: You are still eligible to purchase a flood insurance policy following the folding of your home, condo, apartment, or business has been flooded, as long as your community is participating in the NFIP.
Myth #5: You have coverage for flooding through your homeowners insurance policy.
FACT: This is not true in that homeowners and business insurance policies do not cover flooding. Through the NFIP you can receive a separate policy that will protect your single most important financial asset, which in most cases is your home or business. Contents coverage can be included by homeowners in their NFIP policy. Residential and commercial renters can protect their income by purchasing flood insurance coverage for their buildings and for content and inventory.