If you are in a high-risk flood zone, a federally regulated lender will require a would-be borrower to buy flood insurance in order to qualify for a mortgage loan. To satisfy the lender, flood insurance must be purchased in an amount that sufficiently covers the loan.
A homeowner should also buy flood insurance if he or she resides in a flood plain with no failsafe controls, such as a dam. Flood policies even pay off if the President does not declare the area a federal disaster area, which can prove to be invaluable. Because the nation's Chief Executive Officer rarely issues such a declaration, protecting yourself is extremely important. Besides, you have to repay the federal aid you receive for home repairs related to a natural disaster so providing your own protection is the only way to ensure financial recovery suffered from flooding.
Not all homes qualify for flood coverage. For instance, flood insurance for beachfront or ocean-side property may not be available for the obvious reasons.
The Federal Emergency Management Association (FEMA) reports that more than 20,000 communities have agreed to tighter zoning and building measures to control floods. Residents of these communities can buy flood coverage from the National Flood Insurance Program (NFIP), which FEMA oversees. As of 2009, NFIP had 5.7 million flood policies inforce nationwide.
Premiums for flood insurance vary widely, depending primarily on individual risk. In determining price, flood insurance underwriters consider several factors including the property's elevation, proximity to bodies of water, and whether the dwelling has a basement. If you are NOT in a flood zone you may qualify for preferred rates that can be as low as $200 per year. Flood insurance is available to homeowners, renters, condo owners/renters, and commercial owners/renters. Call our office for a quote on flood insurance today at 214-275-8372.