Flood insurance in New Jersey: How much is it & what does it cover?

The average cost of NFIP flood insurance in New Jersey is $80 per month. Residents of the state’s eight coastal counties and other areas at high risk of flooding will want to consider flood insurance.

Pat Howard 1600

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Pat Howard

Pat Howard

Senior Editor & Licensed Home Insurance Expert

Pat Howard is a senior editor and licensed home insurance agent at Policygenius, where he specializes in homeowners insurance. His work and expertise has been featured in MarketWatch, Real Simple, Fox Business, VentureBeat, This Old House, Investopedia, Fatherly, Lifehacker, Better Homes & Garden, Property Casualty 360, and elsewhere.

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Around 17% of New Jersey is within a high-risk flood zone, the sixth highest of any other U.S. state, according to our analysis of Federal Emergency Management Agency (FEMA) data. [1]

While most of the Garden State’s flood plains are in counties that border the Atlantic Ocean and Delaware River, there are many additional sources of flooding besides hurricane storm surge or overflowing riverbanks. Flooding can happen anywhere in New Jersey for any number of reasons, including heavy rainfall or rapid snowmelt. 

Since standard home insurance in New Jersey doesn’t cover water damage from flooding, you’ll want to consider purchasing flood insurance to ensure you’re fully protected. Though flood insurance is not required by law in New Jersey, if your house is located in a FEMA-designated special flood hazard area, which is any area labeled A or V on FEMA’s flood maps, your mortgage lender may require you to purchase flood insurance. 

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How much is flood insurance in New Jersey?

The average cost of flood insurance in New Jersey is $963 per year through the National Flood Insurance Program (NFIP), the federal government entity that provides the vast majority of flood insurance policies in the U.S. 

Looking at the 40 New Jersey communities with at least 1,000 NFIP policies, the average cost of flood insurance is as high as $1,184 in the borough of Beach Haven on Long Beach Island, and as low as $330 per year in the borough of Edgewater along the Hudson River. 

Here’s a look at the average cost of flood insurance in New Jersey cities with at least one active FEMA flood insurance policy. [2]

Your flood insurance costs are generally calculated based on the following factors:

  • Your home’s location

  • Your home’s age, size, and construction type

  • Your home’s elevation

  • Your policy deductible amount

  • The amount of coverage in your policy

In addition to the above factors, the amount you pay for flood insurance will also depend on how your flood insurance provider calculates your rates.

FEMA, for example, has historically based its rates on whether or not your house is in a high-risk flood zone according to its Flood Insurance Rate Maps (FIRMs). This means you’ll often pay the same flood insurance rate as your neighbor if you live in the same flood zone, even if their house is larger or closer to a beach or riverbank.

Conversely, private flood insurance providers use more advanced methods to determine and price flood risk. This includes analyzing each home’s elevation and simulating flood events using computerized models.

NFIP flood insurance rates are going up in New Jersey

Flood insurance in New Jersey is expected to get more expensive under Risk Rating 2.0 — the NFIP’s new method for calculating rates. Roughly 80% of active flood insurance policies with a renewal date on or after April 1, 2022 will see an average rate increase of $100 in year one of the new rate structure. 

Flood insurance rates by flood zone in New Jersey

Flood insurance rates in New Jersey will generally vary depending on where you live and whether or not your house is in a FEMA flood zone, which it determines based on the likelihood of flooding over a period of time. Any A or V zone, for example, has at least a 1% chance of flooding during any given year. 

Also referred to as a 100-year flood plain, these areas have the highest flood risk, according to FEMA flood maps. Here are the average flood insurance rates in areas with a high risk, moderate to low risk, and undetermined risk, according to an analysis of NFIP premium data.

Flood zoneAverage annual cost
High risk (A or V)$1,026
Moderate to low risk (B, C, or X)$637
Undetermined risk (D)$1,262

How to find out if your home is in a high-risk flood zone

To find out if your current or future house is in a FEMA-designated flood plain, consult the agency’s Flood Map Service Center. These maps can help you make an informed decision about where to live, what to build, and can help you determine whether or not you’ll need flood insurance.

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What does flood insurance cover in New Jersey?

Flood insurance helps cover the cost of flood damage to your home and belongings. That means if your house is damaged due to coastal flooding, a river overflow, or any source of natural flooding, flood insurance can pay to repair or replace your property. 

A standard flood insurance policy through the NFIP comes with two main coverages that can be purchased together or individually.  

  • Building property coverage: Pays to repair or rebuild your house or garage if they’re damaged in a flood. The maximum building property coverage limit with the NFIP is $250,000, meaning that’s the most the NFIP will reimburse you for repairs, regardless of the damage amount.

  • Personal property coverage: Pays to repair or replace your belongings if they’re damaged in a flood. This includes your furniture, electronics, clothes, and any other items you own. The maximum personal property coverage limit with the NFIP is $100,000.

Each coverage also comes with its own separate out-of-pocket deductible, which is the amount you’re responsible for paying on each claim. Choosing a higher deductible will lower your flood insurance premium, but it will also reduce your claim payment.

Covered by NFIP flood insurance

  • Your home’s structure, including electrical and plumbing systems

  • Built-in appliances like refrigerators and dishwashers

  • Personal belongings like clothing, furniture, and electronics

  • Expensive valuables (up to $2,500)

  • Detached garages 

  • Debris removal

Not covered by NFIP flood insurance

  • Home or personal property damage caused by mold, mildew, or moisture

  • Currency, precious metals, and valuable papers

  • Belongings outside of your home, such as trees, plants, decks, hot tubs, etc

  • Any belongings in your basement

How to buy flood insurance in New Jersey

New Jersey residents can buy flood insurance in one of two ways: through the NFIP, which is regulated and backed by the federal government and sold by insurance companies, or private flood insurance.

Private flood insurance vs. NFIP coverage

Private flood insurance generally gives you the option for higher coverage limits beyond the relatively low $250,000/$100,000 in coverage you’re limited to with the NFIP. 

Additionally, private flood policies include coverages and perks that aren’t available through the heavily regulated NFIP. This includes loss of use coverage to help cover the cost of lodging or restaurant meals in the event your house is badly damaged and you’re forced to evacuate; or replacement cost coverage for your personal belongings. 

Here’s a look at what New Jersey residents can expect with NFIP and private flood insurance.

NFIPPrivate flood insurance
Maximum home rebuild limit$250,000Typically up to $500,000 or higher
AvailabilityEvery county in New JerseyMay be limited in high-risk areas
Waiting period30 daysAs little as two weeks
Accepted by mortgage lendersYesYes
Replacement cost building coverageYesYes
Replacement cost contents coverageNoYes
Loss of use coverageNoYes
Loss avoidance coverage (sandbags, etc.)NoYes
Debris removal coverageYesYes

Flood insurance helps fill an important coverage gap

Most homeowners insurance policies do not cover water damage caused by flooding, so if you live in a flood-prone area of New Jersey, particularly in an Atlantic Coast or Delaware River-adjacent county, you should consider purchasing flood insurance.

Do I need flood insurance in New Jersey?

While you aren’t legally required to buy flood insurance in the Garden State or anywhere else in the country, if your home is one of the approximately 360,574 New Jersey housing units in a FEMA-designated high-risk flood zone, your mortgage lender may require it as a stipulation in your loan agreement. 

But even if your lender doesn’t require it, homeowners in flood-prone areas of New Jersey will want to consider this important piece of financial protection. While only around 10% of New Jersey homes are located in Special Flood Hazard Areas, around 25% of all flood insurance claims come from moderate- to low-risk areas, according to FEMA. [3]

Here’s a look at the total number of housing units and the percentage of all homes in high-risk flood zones for each county in New Jersey.

County

Housing units in SFHAs

Total housing units

Percentage of homes in SFHAs

Atlantic

47,401

126,647

37%

Bergen

22,133

352,388

6%

Burlington

9,436

175,615

5%

Camden

6,433

204,943

3%

Cape May

66,684

98,309

68%

Cumberland

2,694

55,834

5%

Essex

7,855

312,954

3%

Gloucester

3,020

109,796

3%

Regardless of which flood zone you live in, you’ll want to make sure you’re finding the best flood insurance at the most affordable rate. For the best flood insurance policy comparison, consider comparing both NFIP and private flood insurance plans with Policygenius. 

Our team of licensed insurance agents at Policygenius can help you compare policies and find the best option for you. Click the calculator to get started.

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