Flooding is unpredictable. It can happen almost anywhere at any time, even if it has never happened before. It might take very little for a flood to come along and destroy your home. Even seemingly innocuous damage could cause a total loss. If that happens, then you might need money to rebuild the property. Flood property insurance can help you do so. How does your policy apply when it comes to rebuilding some or all of the property?
In most cases, you’ll be able to receive ample protection in case of damage or destruction to your home from a flood. Keep in mind, however, that your policy will provide only limited protection in some cases.
How Floods Can Damage Homes
Floods are just water, right? Wrong.
When floodwater enters your home, it is one of the most-invasive types of property damage. It can cause hazardous conditions, including contamination by debris and pests. It can also cause structural damage to the property. It might make the home unlivable until you repair it. In other cases, you’ll lose the home entirely.
Flooding might cause structural damage to a home’s foundation or structure. That might make it unsafe to occupy. Sometimes, a full or partial collapse might even occur. In other cases, the amount of water damage might prove too expensive to repair. You might simply have to rebuild from the ground up.
Still, rebuilding costs money. You can’t guarantee that you’ll have that money on hand at a moment's notice. If you have flood insurance, however, you’ll be able to get help in this regard.
Flood Insurance Replacement Cost Coverage
Flood insurance provided by the National Flood Insurance Program (NFIP) will include replacement cost (RCV) structure coverage. The policy will provide you with enough money to rebuild or repair the home like what it was before the flood.
However, policies backed by the NFIP will only provide a maximum of $250,000 in RCV coverage. Even if it will cost more than that to rebuild a home as it was before the flood, you’ll still only receive $250,000 maximum.
However, the structure coverage will not apply to depreciated value of items. For example, the appraised value of your home might drop from the time you got the policy.
However, you’ll still be able to get coverage for the value of the home listed on the policy. Remember though, increasing costs of labor or materials might make it more expensive to rebuild the home. However, you'll still only receive up to the coverage limit listed on the policy.
Looking for additional flood insurance? Call Insurance Discounters of Texas at (281) 351-2880 today to learn more about various coverage options.
Also Read: Start Planning To Avoid Flood Risks