Jun 25, 2012

Flood and earthquake coverage

Do you live in or have you moved to an area which is prone to flooding and earthquakes? Is your current insurance updated to give you adequate coverage when and if the rain starts and there is a flood or an earthquake and your home is demolished? Don’t wait for the last minute to put your insurance needs in place. Answer the following to get a quick answer as to what you will need to do.

• Have you had one or more earthquakes in your area – meaning location of frequent earthquakes or floods – and your property has been severely affected?

• Is your house solidly constructed to withstand an earthquake and will you be able to pay for all water damage?

• Could you absorb the cost of replacing your home and personal property? If your answer is no it is time to update your coverage to reflect your current needs.

Type of insurance needed

What you need is a flood insurance policy which will provide flood protection for both your residence and its contents. This can be obtained by updating your coverage and purchasing up to a quarter million dollars for the building and up to one hundred thousand dollars to cover your contents. If you need excess insurance for the amount exceeding the amount available through the federal program, you can purchase this through a private insurer. This excess would cover amounts above the $250,000 federal limit.

What is covered and what is not

Flood insurance does not cover all types of damage, such as flood-related basement damage. It also does not cover the failure of a sump pump or seepage or any damage caused by sewer backups unless they are directly related to a flood. Federal disaster assistance is in the form of loans or grants and will only be paid if the damage is widespread and serious and the area is declared as a disaster area by the Federal Management (FEMA).

What you have to do first is to sit down with an insurance expert to determine what is and what is not covered. If you are not covered for damage by either flooding or earthquakes you can buy flood or earthquake insurance if you live in an area prone to these kinds of disasters. Consider purchasing a policy even if you do not live in a high-risk area as melting snow, bad drainage, storms and hurricanes can all cause serious flooding.


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