I have water in my basement due to the heavy rain!

Mike Lombard is a friend of mine who was generous in giving me information about the flooding issues some of us have concerning our properties in Massachusetts. Below is the information he passed on to me (with his permission): 

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With this second week of rain, I have been receiving countless inquiries into what homeowner’s insurance covers in regards to ground water in the basement.  Here are the basics: 

If water seeps into my basement from the ground, am I covered?
No. This type of water seepage is excluded under the Homeowners Policy. And if the water seepage is not due to a “flood”, as specifically described in a flood policy, you will not be covered under a flood policy. Seepage is viewed as a maintenance issue and is not covered by insurance. You should see a contractor about waterproofing your basement. 

Does my Homeowners Policy cover me for flood? 

No. And with the changing weather patterns across the country, it is advisable for almost everyone to consider purchasing flood insurance. About 25% of flood claims come from outside high-risk flood areas. Flood insurance is provided by the federal government, under a program run by the Federal Insurance Administration. In some parts of the country, homes can be damaged or destroyed by mudslides. This risk is also covered under flood policies. 

Will my Homeowners Policy cover me if a pipe bursts and water flows all over my floors?  

Yes. The HO-3 covers you for accidental discharge of water from a plumbing system. You should check your plumbing and heating systems once a year. While you are covered for damage, who needs the mess and hassle? 

In addition, below provides answers to some frequently asked questions regarding flood insurance that hopefully is useful to you, your family, friends and clients: 

 WHAT DOES NATIONAL FLOOD INSURANCE COVER? 

Coverage is available for both residential and non-residential properties. We’ll focus in this discussion on residential properties. 

RESIDENTIAL BUILDING COVERAGE 

Building coverage insures a house or dwelling, attached and detached garages, as well as certain permanently installed fixtures such as built-in dishwashers, permanent shelving and cabinetry, furnaces and radiators, hot-water heaters, plumbing fixtures, stoves, ovens and refrigerators. 

Please note that the primary source for flood insurance is the National Flood Insurance Program (NFIP). Under their residential dwelling policy, the maximum limits available are $250,000 on the dwelling and $100,000 on contents, which may not be adequate for many property owners.  For details about what National Flood Insurance covers and what options may be available for additional coverage, contact your agent or insurance company. 

COVERAGE IN BASEMENTS 

It is very important to note that coverage in basements is extremely limited.  

National Flood Insurance covers structural elements, essential equipment and other basic items normally located in a basement, such as: 

         Unfinished drywall for walls and ceilings, including nonflammable insulation  

         Electrical junction and circuit breaker boxes, and required utility connections  

         Central air-conditioning units  

         Furnaces, hot-water heaters, fuel tanks and the fuel inside them, and heat pumps  

         Light fixtures  

         Foundation elements  

         Cleanup.  

National Flood Insurance does not cover basement improvements such as finished walls, floors or ceilings. Also note that coverage for contents in a basement is even more limited and excludes furniture and most other personal belongings. The only contents covered in a basement are air conditioning units, portable or window type, clothes washers and dryers, food freezers, other than walk-in, and food in the freezer. 

RESIDENTIAL CONTENTS COVERAGE (other than in basements) 

            Contents coverage insures most of your personal property and belongings, including: 

         Clothing  

         Furniture, housewares, bedding  

         Decorative items, lamps and lighting fixtures  

         Books, home electronics  

         Area rugs and draperies  

         Clothes washers and dryers  

         Air conditioners  

         Food freezers and the food in them  

         Portable microwave ovens  

CONDOMINIUM ASSOCIATIONS AND OWNERS: 

Condominium associations can purchase flood insurance coverage on a residential building under the Residential Condominium Building Association Policy. Under this policy, condominium associations can purchase up to $250,000 times the number of units or the replacement cost of the building, whichever is less. This way, coverage is provided for each unit without the burden of purchasing policies for each unit separately. Eligible buildings include garden apartment-type construction, town houses, row houses, and single-family detached buildings owned by the association, as long as 75% of the units are used for residential purposes. Residents of the individual units are then advised to purchase contents coverage separately-up to $100,000-to ensure that their personal property will be covered. 

RENTERS 

You don't have to own your own house or apartment to protect your contents from floodwaters. Up to $100,000 of NFIP contents coverage is available to renters of insurable property in a community participating in the NFIP. 

HOW MUCH DOES NATIONAL FLOOD INSURANCE COST? 

The cost of flood insurance can be less than 50 cents a day and, on average, about $1 a day. The average flood insurance premium is only about $370 a year (much easier to budget for than a $50,000 disaster home loan that costs about $310 a month*). Your specific premium will be determined by such factors as where you live; how much coverage you choose; the age, elevation and structure of your home; the building occupancy; and the deductible. 

And, depending on where you live, your annual premiums could be even lower. If you live in a single-family home located in a low-risk area-B, C or X zone on the current flood insurance rate map for your area-you may be eligible for the Preferred Risk Policy. This policy starts at a little more than $100 a year, and both your home and contents are covered with one policy and one premium. 

WHERE CAN I PURCHASE FLOOD INSURANCE? 

To buy a National Flood Insurance policy, call your insurance agent .   

* Flood insurance premiums and Federal disaster loan payments are based on statistics from the year 2000. 

WHO'S ELIGIBLE FOR NATIONAL FLOOD INSURANCE? 

Homeowners, renters and business owners with property in communities that participate in the National Flood Insurance Program can purchase flood insurance. Currently, more than 19,000 communities in the United States and its territories participate in the NFIP by adopting and enforcing ordinances designed to reduce flood damage. 

IF I LIVE IN A HIGH-RISK AREA, CAN I STILL BUY FLOOD INSURANCE? 

No matter where you live, you can buy National Flood Insurance if your community participates in the NFIP*. The program was created to provide Federally backed flood insurance to people who live in areas at risk of flooding. 

* The exception is for buildings in Coastal Barrier Resources System areas. 

DO I NEED FLOOD INSURANCE IF I LIVE IN A LOW- TO MODERATE RISK ZONE? 

Even if you live in an area that does not have a high risk for flooding, it's smart to have flood insurance. As previously mentioned, about 25% of the NFIP's claims come from outside high-risk flood areas. The NFIP's Preferred Risk Policy, designed for residential properties located in low-to moderate-risk zones, is available starting at a little more than $100 per year. 

To determine if you live in a low-, medium- or high-risk flood zone, contact your city or county government (start with the Building or Planning Department). Flood Insurance Rate Maps, published by FEMA, are available for public inspection. Maps can also be ordered by calling 1-800-358-9616 or by visiting www.msc.fema.gov. Another source for determining flood risk is Risk Assessment. 

If your building is located in a flood zone that begins with the letter A or V, you are in a high-risk area. If the flood zone begins with a B, C or X, you are in a lower-risk area and may be eligible for the Preferred Risk Policy. 

WILL I BE REQUIRED TO BUY FLOOD INSURANCE? 

You may be required by your lender to buy flood insurance if you have a Federally backed mortgage loan and the building is located in a high-risk flood area. And your lender may, at its own discretion, require that you buy flood insurance even if your building is outside the high-risk flood area. You may also be required to buy flood insurance as a condition of receiving Federal disaster assistance after Federally declared flood disaster. 

IS THERE A WAITING PERIOD BEFORE THE INSURANCE GOES INTO EFFECT? 

There is usually a 30-day waiting period, after applying and paying the premium, before the flood insurance policy becomes effective. The following are exceptions to this rule: 

         There is no waiting period when flood insurance is required by a lender in connection with the making, increasing, extending or renewing of a loan. The policy will be effective at the date of the loan closing, as long as the application has been completed and the premium payment has been made at or before the closing date.  

         There is no waiting period when flood insurance is required by a lender after a mortgage portfolio review shows that the building is in a high-risk area. The policy will be effective upon the completion of the application and receipt of the premium payment by the insurer. 

         There is a one-day waiting period when a new policy or additional amounts of coverage are required by the lender during the 13-month period following certain map revisions. This applies when the map revision changes the structure's designation from a non-high-risk area to a high-risk area.  

CAN FLOOD INSURANCE BE PURCHASED IMMEDIATELY BEFORE OR DURING A FLOOD? 

You can purchase flood coverage at anytime; however, a new flood policy does not cover a loss in progress. A loss in progress is one already happening as of 12:01 A.M. of the first day of the policy term. 

Mike

Baldwin  /  Welsh & Parker Insurance Agencies

131 Great Road

Bedford, MA  01730

Dir 781-222-5093

Off 781-275-2114

Fax 781-275-3824

www.baldwinweb.com

Bedford, Hudson, Wayland, Winthrop, Topsfield

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There is more info at this site:   http://www.floodsmart.gov/floodsmart/pages/faqs/faqs_considering.jsp

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I got very good and quick service from Northeast Flooring America in Littleton, MA. 1-800-251-1191

Their quick response saved my clients wall-to-wall carpets. They gave my clients several sensable options and were quick to act on them.

John Bielefeld

508-254-5863

Team Advantage of RE/MAX Prestige