Those who own a high-value home should especially consider purchasing Excess Flood Insurance to greatly increase the amount of flood coverage for both the dwelling itself as well as the contents inside. An excess flood policy can also offer funds to cover additional living expenses during the time it takes to repair your residence.
Many homeowners find out the hard way that the standard homeowners insurance policy does not include protection for flood damage, regardless of whether they have a sump pump rider or sewage and backup insurance. Excess flood insurance is effective in a variety of scenarios, and we’d like to take a look at how this coverage can save a homeowner a great deal of time, money, and stress.
Is Excess Flood Insurance Necessary?
If your house is located in a high-risk flood zone and you use a federally related mortgage loan (that’s most mortgages) to buy or refinance it, you are required to have some type of flood insurance. Whether you have to add on an excess policy depends on if an extra policy is required to cover your home rebuilding costs above $250,000.
How much do you owe on your mortgage? State insurance agencies must require at least what you owe on your mortgage up to $250,000, but may require more for asset protection. Some people make a calculated decision not to purchase insurance above that $250,000 limit and they’ll take a risk that the flood damage isn’t going to get so bad that it does monetary damage.
Since Federal government’s National Flood Insurance Program maxes out at $250,000, if you need insurance coverage beyond that, you have to purchase at least some of your flood insurance in the private sector. This will require a federal policy worth $250,000 and an excess flood insurance policy for the additional needed coverage.
Excess Flood Insurance Rates
Rates are dependent upon each individual home so you will need to start seeking quotes from a state insurance agency.
An agent will determine a price for your specific property after considering a number of factors, such as:
- Your home’s location and age
- If your home is in a flood zone
- How high your home is elevated
- What floor your condo is on
- Which way your building faces (toward the ocean or inland)
- How much coverage your want to buy
- The distance from your home to the water
- The size of the deductible you’re willing to pay
About SB One Insurance Agency
At SB One Insurance Agency, we have served the businesses and residents of New Jersey, New York and Pennsylvania for more than 60 years. We are a wholly owned subsidiary of Provident Bank, the region’s premier banking institution, and we are prepared to offer you personal, business, employee benefit, and risk management solutions. To learn more about our coverage options, contact our specialists today at (888) 990-0526.