According to the Federal Emergency Management Agency (FEMA) just a single inch of water inside your home can cause $25,000 worth of damage. Are you covered in the event of a flood?

Many homeowners are under the dangerous misconception that standard homeowner’s insurance covers flood damage. However, the opposite is true – most policies do NOT cover this type of damage. Instead, it’s necessary to purchase special flood coverage on your home.

What Causes Confusion

Many homeowners get an unfortunate surprise when they try to submit a claim for flood damage and realize they aren’t covered, and this is because standard homeowner’s insurance does cover some types of water damage. For instance, if a tornado damages your roof and the rain floods your attic, your policy likely has you covered and will replace tour roof, duct work, personal items that sustained damage and more.

The difference that homeowners need to understand is that any water coming from the ground up requires a specific flood insurance policy in order to be covered.

How to Know if You Need Flood Insurance

Let’s face it, no one wants to pay for extra coverage they don’t need. However, if you live in a federally designated floodplain, you will probably be required to buy flood insurance for your home. Even if you don’t, you may want to consider getting a flood policy if there’s a history of flooding in your area or if you have a body of water near your property. Although it will cost around $600 per year or more, depending on your home’s risk factors, that’s a much smaller sum than the $25,000 in damage from just one inch of water.

Final Thoughts

Like many types of insurance, you’ll need to balance the cost against the level of risk you’re willing to shoulder. It’s also vitally important that you understand the terms of your homeowner’s insurance policy. Read the fine print and educate yourself so you can be sure to have the coverage you need.