Homeowners insurance policies typically protect homes from a variety of perils, commercial property policies may provide similar protections for commercial buildings. Both homeowners and commercial property policies, however, often exclude floods from the perils they cover. Massachusetts homeowners and businesses that would like coverage for flood damage frequently need flood insurance.
Flood policies may be used to insure many kinds of buildings. There are flood policies for single-family homes, condominiums, townhomes and most kinds of commercial properties. Renters may even find flood policies designed to insure their personal possessions.
Many individuals and businesses in Massachusetts can benefit from getting a flood policy.
In regions that are prone to flooding, having protection is generally advisable. In some cases, homeowners and businesses might even be legally required to carry a flood policy.
In low-risk areas, flood policies are often very affordable. Premiums may be so low that purchasing a policy makes sense even if the likelihood of a flood seems small. After all, a single flood can cause extensive damage.
A federally funded program, the National Flood Insurance Program makes flood policies available to property owners in high-risk areas where coverage would otherwise be prohibitively expensive. To obtain coverage through the program, property owners must have residential or commercial property in a community that’s deemed to be at risk of flooding and that participates in the community.
Many communities in Massachusetts participate in the program. A complete list of communities that participate can be found on FEMA’s website.
Alternatively, property owners can talk with an insurance agent who’s familiar with flood policies. An experienced agent will either know or be able to look up whether a specific property qualifies for NFIP policies.
For residents and businesses that are able to obtain coverage through the NFIP, this is usually the most affordable coverage option because it’s subsidized by the federal government.
While specific protections can vary, most flood policies cover claims for damage resulting from atypical water patterns. Depending on a particular policy’s terms and conditions, these patterns might include:
If they’re made available, disaster relief funds can generally be used to repair property damaged by floods. Even though this is normally permissible, there are two significant reasons why property owners may not want to rely solely on these funds.
First, disaster relief funds aren’t always available. They’re only made available when a disaster is deemed a national disaster -- something the president must proclaim. Numerous disasters cause significant local damage but are never deemed a national event.
Second, these funds aren’t free money when they are available. The funds are given as interest-free loans that must eventually be repaid. Thus, property owners ultimately end up paying for repairs themselves, even if they do get to spread the cost out over several years.
Comparing flood policies requires carefully reviewing different policies’ terms and conditions, as well as the terms and conditions of any homeowners or commercial property policy that’s in place. The fine print is what determines how various incidents are treated by a policy.
For help comparing flood insurance policies, contact the insurance professionals at Paul T. Murphy Insurance. Our independent agents have helped many Massachusetts residents and businesses, and we’d be happy to assist you as well.