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Coverages
•National Flood Insurance •Preferred Risk Flood Insurance •Rate Determination |
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Did you know floods can happen anywhere? It's true. In the U.S., floods occur more often than all other natural disasters except fires. Furthermore, it only takes one foot of water to destroy up to 60% of the contents in your home. However, home, renters and condominium policies don't cover flood losses.
Can You Risk Living Without Flood Insurance
Whether you live in a house, apartment or condominium, your valuable possessions should be protected. Without coverage, the time and cost it takes to recover your belongings can make a bad situation even more difficult. Even if you qualify for Federal Disaster Assistance, which may be offered after floods occur, it may not be enough to recover all of your property. And, while disaster home loans may be an option, you also risk having to pay them back—with interest—for an average of 18.5 years. |
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| Coverage Options |
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| National Flood Insurance |
What Coverage Is Included?
The coverage available under a National Flood Insurance policy includes Building Coverage, Contents Coverage, Excess Flood Coverage and Loss Avoidance Measures.
Building Coverage
What's Included?
Building Coverage protects the structure of your home or business. It includes above-ground appliances and other items of property that are considered to be part of the building:
- Central air conditioners, refrigerators and walk-in freezers
- Built-in dishwashers, built-in microwaves, ranges, cooking stoves and ovens
- Hot water heaters, furnaces, radiators and garbage disposal units
- Awnings, blinds and canopies
- Carpet permanently installed over unfinished flooring
- Permanently installed cupboards, bookcases, cabinets, paneling and wallpaper
- Elevator equipment, fire sprinkler systems, light fixtures and plumbing fixtures
- Outdoor antennas and aerials fastened to buildings
In a basement, which is defined as any room where the floor is below ground on all sides, coverage is limited to the following:
- Furnaces, hot water heaters, water softeners, central air conditioners and heat pumps
- Utility connections, fuel and water tanks, and sump pumps
- Unfinished structure, dry wall or sheet rock walls and fiberglass insulation
- Electrical wiring and circuit breaker boxes
- Cleanup after a flood
- Clothes washers, dryers and food freezers located below ground in a basement are not covered under Building Coverage. However, Contents Coverage can be purchased separately for these items.
What Options Are Available?
- Residential homes can be insured up to a maximum of $250,000 under Building Coverage.
- Non-residential buildings can be insured up to a maximum of $500,000 under Building Coverage.
- Replacement Cost Coverage applies to single-family dwellings and residential condominium building associations. To qualify, the building must be your principal residence, it must be owner occupied, and it must be insured at the time of the loss for at least 80% of the building's replacement cost or the maximum coverage available, whichever is less. Condominium unit owners need to purchase Contents Coverage to cover personal property.
Contact me for a complete list of what's included under Building Coverage. |
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Contents Coverage
Why Do I Need It?
Flood claims data confirms that a foot of water can destroy 60% of a building's personal property contents. Flash flooding usually causes more damage to a building's contents than damage to the building itself.
You'll want to think about coverage for your personal property items, as well as the structure of your building. Your personal belongings help make your house, apartment, condominium, mobilehome or co-op unit a home. You don't want to risk losing them in the event of a flood.
What's Included?
Contents Coverage can be purchased for your personal property items located in the building above ground. Personal property items include:
- Clothing and furniture
- Portable or window-type air-conditioning units
- Portable microwaves and portable dishwashers
- Carpets over finished flooring located above ground
- Carpets not permanently installed over unfinished flooring
- "Cook-out" grills
- Food freezers (other than walk-ins, which are covered under Building Coverage)
- Clothes washers and dryers
Clothes washers, dryers and food freezers are only covered by Contents Coverage, whether they are located above ground or below ground in a basement.
How Much Is Available?
The maximum personal property Contents Coverage limit available is:
- Up to $100,000 for contents with a standard National Flood Insurance Policy
- Up to $60,000 for contents with a Preferred Risk Policy
Personal property contents are covered on an actual cash value basis. Replacement Cost Coverage is not available for contents. Please contact me for details. |
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Excess Flood Coverage
In some states, if you purchase standard a National Flood Insurance policy or Preferred Risk Flood Insurance through Tony Baquiran and find you need more coverage than the maximum limit provided by the NFIP program, you may be eligible to purchase additional coverage through an Excess Flood Insurance policy. |
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Loss Avoidance Measures
The base insurance plan also includes up to $1,000 for reasonable expenses, such as sandbagging, incurred to protect your property from the imminent danger of a flood. |
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| Preffered Risk Flood Insurance |
How Do I Qualify?
A Preferred Risk Flood Insurance policy is designed for homeowners in low- to moderate-risk flood hazard areas who want to help protect their home and contents in the event of a flood. In order to qualify for a Preferred Risk Flood Insurance policy, you need to own a one- to four-family dwelling in a low- to moderate-risk flood hazard area that meets certain requirements.
If your dwelling's flood loss history falls into any of the categories below, a Preferred Risk Flood Insurance Policy cannot be written. These requirements apply since the date of construction and regardless of your dwelling's prior ownership:
- Two loss payments, each more than $1,000
- Three or more loss payments, regardless of the amount
- Two Federal Disaster Relief payments, each more than $1,000
- Three Federal Disaster Relief payments, regardless of the amount
- One flood insurance claim payment and one flood disaster relief payment (including loans and grants), each more than $1,0001
What's Covered?
For homes located in low- to moderate-risk flood hazard areas, a Preferred Risk Flood Insurance Policy provides the same coverage as a standard National Flood Insurance policy:
- Your building's structural elements can be insured up to $250,000.
- The contents of your home can be insured up to $60,000. Replacement Cost Coverage is also available for a single-family, primary residence. To qualify, your dwelling must be your principal residence, it must be owner occupied and it must be insured at the time of the loss for at least 80% of the building's replacement cost or the maximum coverage available, whichever is less.2
- In some states, if you purchase Preferred Risk Flood Insurance through Tony Baquiran and find you need more coverage than the maximum limit provided by your Preferred Risk Flood Insurance Policy, you may be eligible to purchase additional coverage through an Excess Flood Insurance policy.
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| Rate Determination |
Your Rates and the National Flood Insurance Program
Companies selling National Flood Insurance coverage do not set Flood Insurance rates. The Federal Emergency Management Agency (FEMA) provides flood zone information to establish Flood Insurance rates. Once a community's flood risk zones have been determined, and the rates established by the Federal Government have been determined, all companies offering National Flood Insurance provide coverage at the same price.
Flood Zones
FEMA creates flood zone designations based on the yearly chance of flooding in every community. Certain zones have higher chances of flooding than others and may require more flood coverage. Various areas of the country have a 1% annual chance of flooding and therefore have some mandatory flood insurance requirements that may apply. The image below depicts areas of significant flooding during in the early to mid-nineties.
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Community Rating System
The Community Rating System (CRS), a program administered by FEMA, provides incentives for communities that voluntarily take steps to reduce the risk of flooding and to increase the effectiveness of flood protection above and beyond the minimum actions required for participation in the National Flood Insurance Program (NFIP).
According to the CRS, community activities to reduce flood risk can fall under one or more of the following categories: mapping and regulations, flood damage reduction, flood preparedness, and programs focusing on public information. |
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| Contact me to learn more about the Flood Insurance coverage that may be available in your community. |
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Copyright ©2008 www.tonybaquiran.net
650.696.1990
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CA Insurance License #0559252 |
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