Flood insurance is coverage for when your home is damaged by a flood. This type of coverage is not included in traditional home insurance. You must purchase a separate flood policy or have it added to your existing policy.
If you are purchasing a home or own a home in a flood-prone area, then it’s in your best interest to consider this coverage. In fact, if you have a mortgage, then coverage may be a requirement. In any case, this coverage protects you, your investment and your belongings.
Some flood policies are sold through the National Flood Insurance Program (NFIP), but some independent insurance companies may also offer policies. Keep in mind that there are two types of policies: one protects your home or the structure; and one covers the contents.
For insurance purposes, a flood is water coming from a natural source which is affecting two or more homes. That means damage from a broken pipe pouring water into your basement does not count as flood damage.
The amount of coverage available varies based on where you purchase the policy. Also, this type of coverage can’t be canceled based on repeated claims.