Flood insurance is a supplemental policy that protects your home/dwelling specifically from flood related issues. At this time, flood insurance is a separate policy, and it is not covered by the standard homeowner’s policies.
Flood insurance covers your property from any type of water damage that enters from the ground level. Some examples would be:
Having a home within flood plains
In these instances, a good flood insurance policy would cover:
Damages to the physical structure of your home or building.
Damages to the losses of contents (clothes, electronics, and other personal property.)
Replacement costs up to the actual cash value of your dwelling.
Not all insurance companies include all coverage points in their standard policy.
Some may require additional premiums to be paid in order to include either the contents coverage or the replacement cost, or both. You need to make sure of what exactly is covered before you sign the policy.
There are limits applicable to the amounts for the damages to the building and the contents.
At this time NFIP (National Flood Insurance Program) imposes the flowing:
The rates for a flood insurance policy are determined by the type of the house and the level of risk of the general area. In general, there are two levels:
The high-risk zone which is defined as an area that a house runs a high possibility to get flooded
The low-to-moderate zone which is defined as an area that a flooding is much less likely to occur.
Houses in a high risk zone are required to have a flood insurance policy by many mortgage companies, while those in a low-to-moderate zone are not.