Most folks moving to our beautiful coastal communities have never lived close to the beach and are not aware of the different types of insurance required to protect their investment. Here is a quick list of the types of insurance you may want to consider:
Flood Insurance: Most flood insurance policies are written under the National Flood Insurance Program. The rates and underwriting guidelines are set by Congress. There are three common flood zones that determine a property’s flood risk and premium.
- Flood Zone “X”- lowest risk zone, lenders won’t require flood insurance and you qualify for preferred flood insurance rates.
- Flood Zone “AE”-moderate to high risk zone, lenders will require flood insurance on the property and you will need to obtain an elevation certificate to determine the insurance premium.
- Flood Zone “VE”- high risk zone, lenders will require flood insurance and you will need to obtain an elevation certificate to determine the insurance premium as well.
Wind and Hail Insurance: This type of insurance is required by most lenders in our coastal areas and is the one that surprises folks new to our area the most. This insurance only covers losses caused from wind or hail damages including losses caused by hurricanes and typically covers wind-driven rain which is one of the most common hurricane related claims.
Hazard Insurance: This insurance is common and the most comprehensive insurance available. This covers full replacement cost on both the buildings and contents of your property.
Dwelling Fire Policy: Covers your building for full replacement cost if your home should be destroyed by fire.
We hope this information helps you better understand the types of insurance that may be required by your lender when purchasing property in our area. For more detailed information please contact our Hamilton Realty Group of Carolinas Connect Realty team and we will be glad to provide you with our list of “Preferred Insurance Partners” that can assist you, 910.218.1300.