A creek flows through the back yard of a home I am purchasing. Do I have to buy flood insurance?

You might not be required to purchase flood insurance, but you should seriously consider it, even if the creek is no more than a trickle of water. Standard home insurance does not cover losses from flooding. You must buy a separate flood insurance policy to protect your home and belongings from flood damage.

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Many people assume floods happen only near big rivers or coastal areas, but floods are the most common natural disaster in the country, and they occur in every state. People who don't live in high-risk flood zones file more than 20 percent of flood insurance claims and receive a third of disaster assistance for flooding, according to the National Flood Insurance Program.

Under federal law, you must buy flood insurance if you have a federally-backed home loan, such as an FHA loan, on a property in a high-risk flood area. But your lender might still require coverage, even if you live in a moderate-to-low-risk area for flooding.

You can buy flood insurance from any of the some 90 private insurance companies that are licensed to sell coverage through the National Flood Insurance Program, administered by the Federal Emergency Management Agency. Ask your home insurance agent for information or go to the NFIP website.

Understand the workings of flood insurance before you purchase a policy. A home insurance policy includes coverage for personal belongings, but you must buy both contents and building coverage when purchasing flood insurance to protect your possessions as well as the home's structure. You're also limited to how much coverage you can buy through the NFIP program -- up to $250,000 for the building and up to $100,000 for personal belongings. If you need more protection, you have to buy excess flood insurance through a private insurer.

Flood insurance also excludes coverage for certain things, such as personal belongings in basements and hot tubs and swimming pools. Read the policy to understand the important distinctions.

For more on the details of flood insurance, see "5 ways flood insurance my soak you."