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The Truth About Flooding: Flood Insurance

New Jersey Flood Insurance

In the past few years, New Jersey has been affected by an increasing number of large storms.  We’ve seen many customers suffer damage to their homes caused by outright flooding.  As such, we are now suggesting that all homeowners in NJ carry flood insurance or increase their sump overflow coverage, particularly if they have a finished basement.

Home insurance policies generally do not cover flood damage, and sump or sewer backup coverage is limited.

This post will focus on flood insurance and where applicable, NJ flood insurance.

What Exactly is Flooding

Flooding is defined as water that penetrates your house from the ground.  For example:

After a rainstorm, you discover water has come into your basement through cracks in the foundation

Water pools by a basement window on the ground and trickles into the basement

A local stream overflows its banks and flooding conditions exist around your house.

Broken Pipes and Flooding

Note that broken pipes, water that penetrates your home from roof damage during the storm, or rain that enters from your siding or above ground windows is NOT considered a flood and would be covered under the terms of your home policy.

FEMA and Flood Insurance

Generally speaking, as part of “concurrent causation,” flood conditions may invalidate the sump overflow coverage available on most policies.

Flood insurance is generally available by insurance companies and underwritten by FEMA.  All of these policies, which comprise over 90% of all flood insurance sold in the US, work identically.

Flood zones are defined as X, B, C, A and V.  If your community has elected to participate in FEMA’s program, and your property is in an X, B, or C zone, you can obtain insurance relatively cheaply – from $154 to $405 per year depending on the level of coverage you select.

If you are in an A or V rated zone, you are considered to be in a standard zone, and your price can run into the multiple thousands of dollars per year, depending on the exact zone type and the type and elevation of home you have.

Flood insurance generally limits the amount of coverage for items in your basement, and can have depreciation taken on claims if you do not insure to the maximum coverage available or the reconstruction value of your house.

Other posts in our Truth About Flooding series:

Flood Insurance Coverage

Flood Insurance Pricing

NJ Flood Insurance: Sump Pump, Drain and Sewer Overflow Coverage

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