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Lawrence Said:

Does flood insurance cover a flooded basement if a water pipe burst in the basement, not because of rain?

We Answered:

No. A "indoor flood" resulting from a burst pipe is somewhat different to a flood resulting from natural causes. This insurance only covers floods because of rain, storms, living near a beach, and so on. You would need household insurance for a burst pipe causing the flood.

Gary Said:

if your car becomes caught in a flood does insurance cover replacement or repair?

We Answered:

depending on how good of insurance you have it will usually replace the vehicle,,instead of repair,,it all depends on how bad it was flooded,,and what the actual estimate of repair is on it,,if its over half the value of the car they usually just replace it,,to avoid long term problems,,i hope this helps .

Dora Said:

Do I have to have my flood insurance cover the amount equal to the cost of my new home?

We Answered:

No. Actually, in some cases, you can't do that.

Flood insurance is funny - it's completely controlled by the National Flood Insurance Plan, a division of FEMA. You HAVE to follow their rules.

You cannot just insure for the "lowest amount of coverage", aka, the mortgage balance on the house. You will have to insure for 80% of the replacement value of the house (you do NOT have to insure contents!), but there is a maximum dollar amount that you can insure - I THINK it's $250,000 for a single family home, but it's been a while.

You can't just pick $35,000 to insure the house (say, the loan balance) because the flood policy has an 80% coinsurance clause. That means, if you only partially insure the house, they only partially pay the claim. So, if you had a claim, with $40,000 of damage, they would pay . . . not $35,000 less your deductible, but closer to $20,000 which leaves the bank holding a note on a house that YOU can't afford to repair, and they don't want to end up owning it!

Flood rates and terms are set by the federal government, so there isn't any negotiation room.


**Also. Check with your mortgage company. Just because your area *might* be re-rated (ok, it will LIKELY be rerated, but that doesn't mean you won't be in a 100 year flood plain any more!), that does NOT change the original terms of the mortgage. So if the ORIGINAL mortgage terms require that you buy flood insurance, THOSE TERMS DON'T CHANGE WHEN YOUR AREA IS RERATED. You'll have to get another mortgagee, if you're not going to be in a 100 year flood zone. Additionally, if you DO decide to change mortgages, keep in mind that when you CANCEL your flood policy, you do NOT get a refund on any unearned premium, unless you can prove you sold the house. Being changed from a flood zone A to a B, meaning you don't "have" to carry flood insurance, does NOT allow you to cancel the policy and get any kind of refund, and you are NOT eligible for a re-rate until the renewal date.

Gabriel Said:

Does insurance cover damage to inside stuff if there is a flood due to pipes being frozen?

We Answered:

Yeah I think it does.. but make sure you have that option chosen in what you pay. I don't think they cover flooding from overflowing creeks and stuff like that. But you may be able to get that extra.

Gwendolyn Said:

How can I get my home insurance to cover my recent "flooding" after our sump pump broke?

We Answered:

"Flood" is excluded under every homeowners policy. If you read your policy, the coverage for water damage specifically excludes coverage for sump pump failure.

You'd need to put the coverage in on your FLOOD insurance policy, if you carry it. Keep in mind, flood insurance doesn't cover contents stored in your basement, only STRUCTURES.

You flat out can't get your homeowners policy to pay for something that isn't covered. It's like going to a car lot, paying for a Hyundai, and complaining that you didn't get a Ferrari. Sorry.

Stella Said:

Does federal flood insurance cover the appraised value of a house?

We Answered:

Neither - it's based on the "cost to rebuild". If the building is a 'total loss' (not quite the same as "total loss of use", it will only pay depreciated value if the owner decides not to build there again - assuming that there isn't a 'coinsurance' issue.