Insuring your home against natural disasters can save you quite a bit of money in the event such a disaster occurs. Frequency of different types of natural disasters varies by region. While this is also true of floods, floods can occur pretty much anywhere, so flood insurance may be worthwhile regardless of whether you are in a flood zone or not. So what do you need to know about flood insurance?
Flood insurance is not legally required. However, some mortgage lenders may require it, especially if the property is in a flood zone. As can be expected, flood insurance premiums are higher in flood zones, since there is more risk. That also means it can be relatively inexpensive if your area is not flood-prone. Since floods still occur at a significant rate in such areas, it’s probably a good deal even if the lender doesn’t require it. If you do get flood insurance, whether you chose to or your lender asked for it, make sure to compare plans. Premiums vary by company, and most companies have more than one insurance policy. Most policies cover damage to both the building and the contents of the home, but you should check to make sure. Some plans also include replacement expenses.
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