I don't live near water—is there any reason why I would need flood insurance?

You should consider purchasing flood insurance even if you don't live in a high-risk area for floods. Factors such as storms, inadequate drainage, melting snow, and hurricanes can cause serious flooding even if you don't live near a river or other body of water. If you are purchasing a home in a designated flood zone, you may be required to purchase flood insurance before obtaining a mortgage.Despite what you may think, your homeowners insurance policy doesn't cover damage from flooding. To complicate matters further, you can't simply buy flood insurance as an endorsement to your current policy. Instead, if you are eligible, you must purchase a separate flood insurance policy through an insurance company that participates in the National Flood Insurance Program (NFIP). Flood insurance is available for residents of approximately 19,000 communities nationwide.A flood insurance policy offers flood protection for both your home and its contents. You can purchase up to $250,000 worth of coverage for the building itself, and up to $100,000 worth of coverage for the contents. However, a flood insurance policy is not a catch-all. For example, flood insurance offers some degree of protection for flood-related basement damage, but it doesn't cover all types of damage. Flood insurance does not cover events such as sewer backups unless they are directly related to a flood.The average flood insurance policy costs around $300 per year. However, if you live in a lower risk area, you can typically reduce the cost by purchasing a lesser amount of coverage.