Flood insurance
- Insurance that protects homeowners against losses from a flood;
if a home is located in a flood plain, the lender will require flood
insurance before approving a loan.
Many homeowners falsely believe that their hazard insurance policies
cover flood damage. The fact is a good homeowner's insurance protects
against almost all perils EXCEPT flood. It is highly recommended
that a separate flood insurance be secured if the property is located
in a flood zone. It protects the homeowner against flood damage,
regardless whether the White House declares a Federal disaster.
Federal law requires homeowners to carry flood insurance if their
home is to be found in a flood zone. Your appraiser and lender will
check to see if your property is located in a flood zone. FEMA (Federal
Emergency Management Agency) determines the flood zones.
Prior to loan closing the lender request a Flood Certification
to determine whether or not your property is located in a 100 year
flood plain.
This process takes place on every loan, it is done by looking at
a specific map. this map will show areas that have flooded in the
last 100 years. If your home falls in one of these areas you will
be required to purchase this type of insurance.
If you already own a house and have owned one for many years the
flood plain may have changed. Due to weather variances over the
last several years some flood zones have changed. If you were close
to a flood zone before it might be in your best interest to find
out if your porperty lies in the flood zone. Most major metropolitan
areas have this information online.
