There are many things in life that people value, and most are willing to do what they can to keep these things and people protected. Often, this means purchasing insurance. But different types of insurance cover different situations and different valuables. Some believe that by carrying insurance on their home and car, they will be mostly covered on whatever mishaps life may throw at them. Unfortunately, this is not necessarily true. In many cases, flood insurance needs to be added to a person’s must have list. Generally speaking, flood damage is not covered by homeowners insurance policies. In areas where there is a higher risk of flooding, many mortgage companies require that a new home owner arrange flood coverage as well as regular homeowner’s coverage before the sale of a new home can go through.
In Milwaukee, Wisconsin, and the surrounding areas, there are several water sources that can contribute to the risk of flooding including, Lake Michigan, Milwaukee River, Menomonee River, Kinickinic River, Root River, and Lincoln Creek. Potentially, there can be an overflow from any of these sources. Extensive rainfall or rapid snow melting can also result in flood damage. Damage from a flood can be extremely costly. It is estimated that a flood bringing in six inches of water into a 2000 square foot home will cost, on average, more than $39,000.
Who Needs Flood Insurance?
Flood risks from all over the country are evaluated by FEMA and the DNR. FEMA maintains insurance rate maps and identifies areas that are flood hazard areas. But even those who do not live in these areas can benefit from carrying flood insurance. Approximately one-quarter of flood insurance claims are made from areas that are not identified as high risk. For the most part, those who are assessed as having a lower risk of flooding will have a lower flood insurance premium. Flood insurance is not exclusively for those who own a home or other property either. There are some policies that are designed with renters in mind so that they can protect their personal belongings in case of a flood.
Limits of Flood Insurance
One mistake that some people make when purchasing flood insurance in Wisconsin is assuming that they will automatically have blanket coverage for any flood or for water damage. Like any insurance policy, the coverage of flood policies can vary depending on the specific policy terms.
Many people, especially those in flood plain areas, hold federal policies that provide subsidized premiums. Federal policies enforce several limits. For example, damage to the actual building is limited to $250,000 regardless of the value of the home, and personal possession coverage does not add up to more than $100,000. In order to offset these limitations, some carry private flood insurance policies.
What is Covered by Flood Insurance and What is Not?
While specific coverage may vary depending on the terms of a specific policy, flood insurance will typically cover the building and foundation of the
- Building that is insured,
- Electric, plumbing, and HVAC systems
- Most major appliances
- Installed carpeting, paneling, built-in bookcases and cabinets,
- Window blinds,
- Detached garages, with limits,
- Debris removal
In addition to these building-related expenses, many personal belongings are usually eligible for coverage as well including
- Portable Appliances, such as microwaves or window air conditioners
- Washers and Driers
- Freezers, including food
- Limited valuables
In most cases, items that are damaged due to standing moisture, mold, or mildew are usually not covered, because often the policy owner has some power to prevent this damage from occurring. Other things that aren’t covered include, cash, precious metals, and valuable papers such as physical stock certificates. Generally, possessions stored in the yard or another place outside the actual house may not be covered either including landscaping materials fences, septic systems, pools, vehicles and decks. In most cases, other living costs, such as temporary housing or business interruption expenses are also not covered.
Basement coverage also carries more limitations when it comes to flood insurance. It is possible that something that is stored in rooms above ground level would not be covered in a basement or a floor that is partially underground. The home’s flood zone status and date of construction can also play a role in the amount of basement coverage available. A good Milwaukee area flood insurance agent can help pinpoint specifics as they apply to specific policyholders.
To learn more about flood insurance policies and how to make sure you are protected as much as possible contact one of our Wisconsin flood insurance agents for more information or to get a price quote.