If you’re a property owner, purchasing flood insurance is one of the smartest things you can do to protect your future. While most real estate owners grasp the importance of buying and maintaining property insurance, many don’t grasp the importance of flood insurance until it’s too late. It’s often helpful to understand the difference between what flood insurance covers as opposed to life insurance and commercial liability insurance so you can make a good decision.
What Is Flood Insurance?
Many property owners don’t realize that almost all homeowners and property insurance policies exclude flood damage from coverage. Homeowners often discover this extensive policy exclusion too late, after a flood has already occurred and they’re dealing with the financial demands of cleaning up after the water has receded. Keep in mind that it’s not unheard of for a small amount of water, around one inch, to result in damages exceeding $25,000.
While flood insurance is particularly important in areas prone to flooding, it’s also critical if you live in a location that seldom sees high water due. Most homeowners policies have common restrictions on water damage that preclude reimbursement for flood-related damages.
Do Life Insurance and Flood Insurance Provide Similar Protection?
Life policies essentially reimburse a beneficiary you name in the event of your death. The beneficiary can use the pre-determined pay-out for whatever they choose. It’s designed to provide for those left behind after the death of a financial provider.
Flood insurance provides reimbursement for flood-related property damages. These policies make it possible for you to fix or replace clothing, electronics, and other items damaged by floodwaters. These policies can also help you pay for any flood-related repairs. Remember that flood insurance doesn’t pay for expenses such as a place to stay or meals eaten at restaurants if you’re flooded out.
Is Commercial Liability Insurance Enough in the Event of a Flood?
If you’re in business, you probably have commercial insurance with liability coverage. It ensures that you’re protected if a client is injured at your place of business or by a non-professional service you provide. Liability insurance won’t help you pay for damages to your business in the case of a flood. It’s important to remember that in the case of a claim, your insurance company will reimburse the injured party, not you.
Summing Things Up
Several types of insurance plans exist for you to choose from, including coverage designed to protect your personal property and business assets from specific threats such as floods and fire. Meeting with an expert insurance agent with experience determining what coverage will work best given your personal circumstances is the best way to get started once you’ve decided to purchase a policy.
Don’t forget to explore other options such as watercraft and umbrella insurance if you have extended coverage needs. And remember, if you’re not satisfied with one policy’s details, keep searching. Tons of policies exist with various terms and conditions, so keep working with your insurance agent until you find the right fit.