The main reason a homeowners form excludes flood is that a flood loss:
Explanation
Insurers exclude perils that are catastrophic, because a single event soaks thousands of insureds at once and defeats the spread of risk that pooling depends on. Other exclusions exist for different reasons: wear and tear is excluded as a certainty rather than an accident, and auto liability is excluded because a personal auto policy is the right place for it. Flood is excluded for the catastrophe reason.
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Related questions on this topic
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