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How to Decide if You Need Flood Insurance

Flood insurance is not optional if you live in a high-risk flood area, as most lenders require it. But what if you don’t live in a high-risk area? Is flood insurance worth the investment? The answer depends on several factors, including your home’s location, personal risk tolerance, and budget. Anthony Lancaster Insurance Inc. in Memphis, TN provides this guide in navigating this important coverage.

Factors to consider when deciding if you need flood insurance:

1. Consider Your Home’s Location

FEMA, which is responsible for floodplain management in the United States, designates high-risk, moderate-to-low risk, and undetermined risk areas. If you live in a high-risk area, your lender will require you to have flood insurance. If you live in a moderate-to-low-risk area, it is still recommended that you have flood insurance, as flooding can occur even outside of designated flood zones. If you live in an undetermined risk area, your decision to purchase flood insurance is entirely up to you.

2. Know Your Risk Tolerance

A key factor to consider when deciding if you need flood insurance is your personal risk tolerance. Ask yourself how you would feel if your home was flooded and you didn’t have insurance to cover the damages. If the thought of being financially responsible for repairing or replacing your home and belongings is too much to bear, then flood insurance may be a good idea.

3. Understand Your Homeowners Policy

Even if you don’t live in a high-risk area, your home may still be vulnerable to flooding. Homeowners’ insurance policies typically don’t cover flood damage, so it’s important to understand your policy’s limitations. If you have questions about what your policy covers, reach out to your insurance agent or company. This way, you’ll know if you need to purchase additional coverage.

Contact Us Today

If you’re unsure whether or not you need flood insurance, reach out to Anthony Lancaster Insurance Inc. in Memphis, TN for help. Our team of experts can help you understand your risk and make the best decision for your needs. Give us a call today to get started.

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