What Does Flood Insurance Mean?
Flood insurance is a type of property insurance that offers protection against losses caused by flooding or water overflow. As typical homeowners insurance does not cover this hazard, a separate policy must be purchased.
Insuranceopedia Explains Flood Insurance
In the United States, only a select amount of companies offer flood insurance because the amount of claimants far outweigh the number of people interested in this type of coverage; thus, private insurers view the likelihood of making a profit as slim. Some mortgage lenders, however, require flood insurance, especially for high value homes as well as those located in high risk areas. Nonetheless, the National Flood Insurance Program, initiated by the U.S. government, offers a flood insurance program for both private and public buildings while also encouraging citizens to support and comply with flood management regulations.