What Does Flood Insurance Cover?

Many homeowners are unaware that their home insurance doesn’t cover flood damage. Flood insurance is one of the best ways you can protect yourself from flood losses. Contents coverage can include possessions such as furniture, clothing and other valuables, subject to policy limits and exclusions. Flood insurance covers certain cleanup expenses. It also covers damages to your heating and cooling system and repair or replacement of flooring, according to the policy. 

What Is Flood Insurance?

The legal definition of a flood, as defined by the The National Flood Insurance Program (NFIP), is as follows:

A general and temporary condition of partial or complete inundation of 2 or more acres of normally dry land area or of 2 or more properties (at least 1 of which is the policyholder’s property) from:

—Overflow of inland or tidal waters; or

—Unusual and rapid accumulation or runoff of surface waters from any source; or

—Mudflow; or

Collapse or subsidence of land along the shore of a lake or similar body of water as a result of erosion or undermining caused by waves or currents of water exceeding anticipated cyclical levels that result in a flood as defined above.

Anywhere it rains it can flood.

Many conditions can result in a flood: hurricanes, broken levees, outdated or clogged drainage systems and rapid accumulation of rainfall.

Just because you haven’t experienced a flood in the past, doesn’t mean you won’t in the future. Flood risk isn’t just based on history, it’s also based on a number of factors such as: rainfall, river-flow and tidal-surge data, topography, flood-control measures, and changes due to building and development. New development miles upstream can create flooding in your area.

Why Do You Need Flood Insurance?

Protect Yourself with Flood Insurance

Just a few inches of water from a flood can cause tens of thousands of dollars in damage. Over the past 10 years, the average flood claim has amounted to nearly $42,000, according to the National Flood Insurance Program (NFIP).

Flood insurance is the best way to protect yourself from this devastating financial loss.

Understanding the Requirements

Congress mandated federally regulated or insured lenders to require flood insurance on properties that are located in areas of high risk flooding.

Below, you’ll find the insurance requirements for your flood risk area. If you’re not sure which area your property is in, please give your insurance agent a call. If you don’t have an agent, please call 1.800.423.4403 and we can assist you with finding an agent in your area.

High-Risk Areas (Special Flood Hazard Area or SFHA)

Homes and buildings in high-risk flood areas with mortgages from federally regulated or insured lenders are required to have flood insurance. In high-risk areas, there is at least a 1 in 4 chance of flooding during a 30-year mortgage. High-risk areas are shown on the flood maps as zones labeled with the letters A or V.

Moderate-to-Low Risk Areas (Non-Special Flood Hazard Area or NSFHA)

Homes and businesses located in moderate-to-low risk areas that have mortgages from federally regulated or insured lenders are typically not required to have flood insurance. These areas are shown on flood maps as zones labeled with the letters B, C or X (or a shaded X).

Even though flood insurance isn’t federally required, anyone can be financially vulnerable to floods. In fact, people outside of mapped high-risk flood areas file over 20-percent of all National Flood Insurance Program flood insurance claims and receive one-third of Federal Disaster Assistance for flooding.

How Does Flood Insurance Work?

National Flood Insurance Program (NFIP)

In 1968, Congress created the National Flood Insurance Program (NFIP) to help provide a means for property owners to financially protect themselves. The NFIP offers flood insurance to homeowners, renters, condo owners/renters and commercial owners/renters if their community participates in the NFIP. Participating communities agree to adopt and enforce ordinances that meet or exceed FEMA requirements to reduce the risk of flooding.

Costs vary depending on how much insurance is purchased, what it covers, and the property’s flood risk.

All policy forms provide coverage for buildings and contents. Typically, there’s a 30-day waiting period—from date of purchase—before your policy goes into effect. That means now is the best time to buy flood insurance