Flood Insurance

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When you buy a basic homeowners insurance policy, even though you might understand that it will not cover you against absolutely anything that can go wrong, you might expect it would cover you if your house were flooded. In fact, it almost certainly will not. So what do you do? You should research whether your house is in a flood plain. If it's not, you may not really need flood insurance. If you do decide to buy flood insurance, it will probably be cheap. But if your house is in the flood plain, you probably need flood insurance, and then it's not so cheap. Flood insurance for houses that are in danger of flooding is provided by a special federal government program called the National Flood Insurance Program (NFIP), which is administered by the Federal Emergency Management Agency (FEMA). It should be noted that for homeowners, the current maximum amount of coverage available under the standard flood policy is typically $250,000 for the structure and $100,000 for the contents (2010). The standard flood policy issued by the NFIP is a dwelling policy rather than the much broader homeowners insurance policy. You can also buy flood insurance if you are a renter or a small business owner. The best thing is to ask your insurance broker for help and advice. According to FEMA, more than 25% of all flood claims are paid on buildings in areas identified as low to moderate risk.