Real Estate Term of the Day: Flood Insurance
FLOOD INSURANCE – an insurance policy that covers property damage due to natural flooding. Flood insurance is offered by private insurers but is subsidized by the federal government (Barron’s Dictionary of Real Estate Terms)
When you purchase your home, your lender will always require a flood certificate to be ordered to verify if your new home is in a flood zone. If you live in a Special Flood Hazard Area (SFHA) or high-risk area and have a Federally backed mortgage, your mortgage lender requires you to have flood insurance.