June 1st was the start of hurricane season and in a few days it will officially be summer. Summer is your favorite time of year as you get to enjoy and show off your beach house to your friends and clients. Have you done everything to make sure if the inevitable bad storm comes, you can rebuild?
Flood insurance is part of owning a beach house. Unfortunately the Federal Flood Insurance Program provides limited coverage, especially for a secondary home. These policies provide up to $250,000 for the building and $100,000 for contents. The next caveat is since this is a secondary home you will only receive “Actual Cash Value” for your claim (depreciation). This means if the carpet is 5 years old, you receive the value for 5 year old carpet. This goes for every piece of the claim; floors, cabinets, walls, contents, etc.
Did you know that some companies will add flood insurance onto your home policy if you are in the correct flood zone or have completed certain flood proofing measures. That would provide you the same level of coverage you have on your home for a flood claim. In addition there is excess flood insurance. This allows you to purchase coverage in excess of the Federal Flood Insurance Program up to the replacement cost of your home and contents. Also, if you have a guest house on the property, that building needs its own flood policy.
How can I pay less for my flood insurance?
Reducing flood risk for homes that cannot be elevated
Brian P. Boak, CPRIA, CLU, LUTCF
Fee-Only Insurance Fiduciary, P&C
Analyze – Advise – Protect