Flood Insurance Flashcards
Definition of a flood
- A general and temporary condition
- Partial or complete inundation
- Two or more acres of normally dry land or two or more properties
Non Participating Communities
- No flood insurance
- No disaster relief
- No federal mortgages in SFHA
When can flood insurance not be purchased?
- Immediately before or during a flood
What is not insured by the national flood insurance program?
- Basement Coverage
Special Flood Hazard Areas (SFHA): Darkly Shaded Area
- Greater than 1% chance of being flooded
- 100 year flood plain
- Greater than 26% chance of flooding during 30 year mortgage
Special Flood Hazard Areas (SFHA): Light Grey or No Shading
- Less than 1% chance of flooding
- Approximately 30% of claims located
Mandatory Purchase Requirement
- Flood Insurance purchase requirement for certain homes in SFHA
- Coverage must be provided for the term of the loan
Coverage limit must equal the outs
What must the Mandatory Purchase Requirement Coverage Limit Equal?
= Either (Whichever is lower)
- outstanding principal balance of the loan
- the maximum limit available under the program
Who can buy flood insurance?
1) Participating Community
2) All zones
2 Types of Flood Insurance Policy Types
1) Dwelling Form
2) General Property Form
Dwelling Form
- More residential: 1-4 Family residence
- Single Family, Duplex, Triplex, Quadplex
- Condo Unit: Not whole unity, only single family unit
- ACT or Replacement Cost
Where would a larger condo unit before insured?
Business Policy: Not a dwelling form
Coverage A: Dwelling Form
- Covers damage to the building/dwelling cased by covered perils
- $250,000 Max
Coverage A: Other Structures
- 10% of the LOL may be used to cover other structures from covered perils (ONLY ATTACHED Structures)
- A detached garage is the only detached structure that may be included
- NOT Additional Coverage: Does reduce overall limit
Coverage B: Dwelling Form
- Direct Loss Personal Property: NOT INDIRECT
- Inside Building
- TV, bed, furniture, clothes, dishwasher
- ## Basement Limitations
Coverage B: Basement Coverage
- Foundation Elements
- Required Utility Connections: Gas, Line, Internet
- Items necessary to live; oil tanks, water heaters, furnaces, pumps, electrical junction/circuit, electrical outlets/wiring
- Unfinished Ceilings/Walls
- Not extended to wall paper, ceilings, finishing
Coverage C: Dwelling Form
- Other Coverage
- Debris Removal
- Loss Avoidance Measures
- Condominium Loss Assessment
Property Not Covered
- Outside of building
- In, on, or over water; deck covered, dock neither
- Land, tress, shrubs
- Fences, seawalls, piers, and docks
- Fences, seawalls, Piers, and docks
- Crops and livestock not covered
- Hot tubs and swimming pools
- Accounts, bills coins
- Open structures; boat houses
Coverage C: Dwelling Form
- Increased cost of compliance
- Flood proofing
- Relocation
- Elevation
- Demolition
Flood Exclusions
- Earth Movements
- Gradual Erosion
- Sewer Back up or seepage
Deductible
- $500 is standard
- Available to $5,000
Double Deductible
Applies separately to A and B
- $100,000 loss for both = $1,000 not $500
Requirements to increase deductible
- Nowhere near flood zone
- Bank not making buy policy since not near flood zone; so doesn’t care
Replacement Cost Coverage
- Cost to buy new to replace old
- Primary residence; not vacation
- Building, not contents
- Insured to 80% replacement cost (Requirement for loans in high risk area) or maximum available
- Otherwise ACV applies
