Home insurance comes in different forms and depending on which type of policy you choose your home insurance rates and coverage options will be quite different.
- HO-1: the most basic form of home insurance »
- HO-2: It is often referred to as "broad coverage" »
- HO-3: also referred to as "special" form »
- HO-4: is often called a tenant’s policy »
- HO-6: type of home insurance addressed condominium unit owners »
- HO-8: such policies are specifically designed for owners of old homes »
Home insurance is a very effective financial tool for protecting your most valuable asset. Learn how home insurance can help you protect your house and its contents against different perils.
Prepare Home Insurance for Spring Showers
Over $2.4 billion in flood damage are lost each year in the Unites States. It’s not insurance companies losing the money—it’s consumers. In Spring, policyholders should be double-checking that they have flood coverage and water damage coverage.
Flood Damage Coverage Not Standard
Most homes in the United States are not covered for flood damage, and many of the homeowners and renters are shocked to find this out only after they file a claim that is denied.
Even many disaster plans do not cover flooding from snowmelt or rainwater. Earthquakes? Check. Volcanoes? Check. Even Meteorites? Yup. But not floods!? Correct.
Who is at risk for floods?
A flood can hit anybody in the United States. Not just people in winter states. Not just people near rivers and dams. Floods happen every year, even in Arizona.
All 50 states in the US recorded flood damage in 2010, and climate change seems to be making it worse.
Head over to FEMA to see if you are in an especially dangerous area.
Preparing for Floods
Insurance is one of the easier steps, even if it is more expensive. You can reduce your risk by understanding how a flood might hit you (a flash flood, a dam break, snowmelt), where the water will enter your home (basement, ground floor, through the walls, through the roof), and how the items in your home will be impacted. Should you worry about the building itself? What about the foundation? What about your possessions, furniture, jewelry, records?
Keep important records and information in a water-proof, secure container. Keep electronics away from places they are most likely to be hit by water.
And for goodness sakes, make sure you have enough coverage for your home itself, the property damage, and all your valuable possessions!
Flood Coverage for Renters
With renters policies, you may only need coverage for your possessions since the property owner likely has the building itself taken care of (they should!!!). Make an inventory of your possessions, noting what you paid, taking pictures, savings receipts, and recording serial numbers. Total up the number and get AT LEAST that much coverage.
Talk to the property owner first, however, and see what your rights and responsibilities are when it comes to maintaining the property. You might need more coverage than you think!
Finding Flood Coverage
Most home insurance companies will offer some sort of flood coverage if you ask for it. However, it might be quite expensive, depending on your provider and your area. Finding cheaper coverage, however, starts with using home insurance quotes. Do a quick search!
A Cheaper Flood Home Insurance Alternative
Depending on the area of the country you live in, you may qualify for a nationally funded program that supplies cheaper coverage for floods alone. This program is called the National Flood Insurance Program (NFIP).
Normally, there is a 30 day waiting period after you pay your first premium before this coverage becomes effective, but homeowners and renters in high risk areas may only have to wait a single (1) day.
NFIP limits coverage to $250 thousand for residential areas, $100 thousand in personal property, and $500 thousand for commercial property.