Flood insurance coverage — explained
Flood insurance reimburses you for damage to your home and belongings due to a flood. Homeowners insurance typically doesn't cover flooding, so you’ll need a separate flood insurance policy if your home is in a flood-prone area. Your mortgage lender may even require this coverage if your home is in a FEMA high-risk flood zone and you have a federally backed mortgage.
To help you understand if flood insurance is right for you, we broke down what it covers, what it doesn’t cover, and when you’ll need to use it instead of homeowners insurance.
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What flood insurance covers
Flood insurance covers damage to your home and belongings directly caused by a flood event. Most flood insurance is sold through the National Flood Insurance Program (NFIP), a federally regulated program with two types of coverages that you can purchase together or separately, depending on your needs.
Building property coverage: Covers your home and built-in systems like your plumbing and electric. This policy has a maximum coverage limit of $250,000.
Personal property coverage: Covers your personal belongings. This policy has a maximum coverage limit of $100,000.
Building property coverage
This covers flood damage to the physical structure of your home and any detached garages on your property. In the event your house is flooded and your floors and walls are severely damaged, this coverage can cover the cost of tearing out and repairing the damaged portion of your home.
Here’s a look at the specific parts of your home that are covered under building property coverage, according to FEMA. [1]
Foundation
Walls, floors, and ceilings
Electrical and plumbing systems
Central air conditioning systems, furnaces, and water heaters
Refrigerators, stoves, and other built-in appliances
Permanently installed carpeting over an unfinished floor
Permanently installed paneling, wallboard, bookcases, and cabinets
Window blinds
Garages not attached to your home (up to 10% of building property coverage)
Debris removal expenses
Personal property coverage
This covers flood damage to your personal belongings inside your home. With personal property coverage, the following items are protected against flood damage, according to FEMA.
Clothing, furniture, electronics and other belongings in your home
Curtains
Window air conditioners
Portable microwave ovens and dishwashers
Carpets that are not covered under building coverage
Washers and dryers
Freezers
Food
Artwork, fine furs, jewelry, and other expensive valuables (up to $2,500)
With FEMA flood insurance coverage, your personal belongings are covered at their actual cash value. This means the amount your insurance company reimburses you during a claim is based on the value of the items at the time they were damaged.
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What’s NOT covered by flood insurance
Flood insurance doesn’t cover flood damage that originates in your home. That means if your house floods because of a roof leak or burst pipe, flood insurance wouldn’t cover water removal or repair costs — however this type of water damage may be covered by homeowners insurance.
Flood insurance generally won’t pay to repair or replace the following items:
Cash
Precious metals
Valuable papers
Trees
Plants
Wells
Septic systems
Walk decks
Patios
Fences
Seawalls
Hot tubs
Swimming pools
Additional living expenses after a loss
Financial losses due to business interruption after a loss
Self-propelled vehicles, like cars and their parts
Does flood insurance cover water damage to basements?
Basements, crawl spaces, and any other floors below ground-level have a greater probability of being flooded than other parts of your house, so NFIP flood insurance policies generally limit coverage for basements.
According to FEMA, the following home features and belongings are not covered if they’re located in your basement at the time of the flood:
Paneling
Bookcases
Window treatments and fixtures
Carpeting, rugs, or floor tiles
Drywall for walls and ceilings
Walls and ceilings not made of drywall
Most personal belongings, including clothing, electronics, kitchen supplies, and furniture
Consider upgrading to private flood insurance
While the NFIP still provides the vast majority of flood insurance in the U.S., more insurers are beginning to offer their own private flood insurance that is written and financially-backed by private insurers, as opposed to the NFIP policy which is backed by the federal government.
Private flood insurance generally comes with a shorter waiting period until your coverage kicks in (14 days or less compared to the 30-day waiting period for federal flood insurance); it offers high coverage limits for your home and belongings; and it includes additional coverages for temporary living expenses and items in your basement.
However, it isn’t subject to the same rules and regulations as the NFIP plan, so insurers can choose to not renew your policy if they find you’re too risky to insure. Additionally, you may also have a hard time finding a company that offers it where you live, as these types of policies are still relatively new.
Learn more >> The top flood insurance companies in the country
When do I need flood insurance?
While flood insurance is not required by law, your mortgage lender may require you to purchase a building coverage policy if you have a federally regulated mortgage and your home is in a FEMA-designated floodplain.
If the following apply to your house or mortgage, you’ll likely need to purchase flood insurance.
Your home is located in a high-risk flood zone according to FEMA flood maps. If your house is in a zone that starts with an A or V, that means you’re in a FEMA floodplain.
You have a federally regulated mortgage with the FHA or VA, or your loan is backed by Fannie Mae or Freddie Mac.
You live in on of the 22,000 NFIP-participating communities.
But even if your mortgage lender doesn’t require this coverage or your house doesn’t have much perceived risk, flood insurance is still a good idea.
Around 80% of Hurricane Harvey victims didn’t have flood insurance, according to researchers at the University of Colorado Boulder, and this could be because many homeowners don't realize that home insurance doesn't cover flooding. [2]
Learn more >> When is flood insurance required?
How to find your home’s FEMA flood zone
To find your community’s flood maps and whether or not your home is in a floodplain, visit FEMA’s Flood Map Service Center and type in your home address. If your house is in one of the turquoise highlighted areas of the map, then it means you live in a Special Flood Hazard Area, or an area with a 26% chance of flooding over the course of a 30-year mortgage. If your home is in one of the orange highlighted areas, it means you live in a moderate- to low-risk area. While mortgage lenders generally don’t require flood insurance for homes outside of high-risk zones, homeowners in these areas should still consider purchasing coverage.
Private flood insurance vs. NFIP coverage: Which option is better?
If private flood insurance is available in your area, you may want to consider one over an NFIP plan. For one, NFIP flood insurance only covers your home and personal property up to $250,000 and $100,000, respectively.
As climate change intensifies and flood events continue to increase in frequency and size, you’ll want to consider a policy that can cover your home for a full rebuild, and the NFIP’s maximum limits may not be enough.
With private flood insurance, maximum coverage limits are higher, and policies generally come with additional protection like loss of use coverage. Additionally, you may find that private flood insurance is cheaper if you live in a lower-risk area.
Learn more >> Private flood insurance vs. the National Flood Insurance Program
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Frequently asked questions
What does flood insurance cover in Florida?
An NFIP flood insurance policy offers up to $250,000 in coverage for the structure of your home, and up to $100,000 in coverage for your belongings. Most policies also include up to $30,000 in increased cost of compliance coverage (ICC), also known as ordinance or law coverage, which covers the additional costs of complying with local building codes. This coverage is especially valuable for Florida residents, since homeowners in the Sunshine State are often required by local building ordinances to completely demolish their home if it’s more than 50% damaged after a disaster. However, $30,000 in ICC coverage and $250,000 in building coverage may not be enough if you’re forced to completely demolish and rebuild your home. Florida homeowners will likely be able to find higher limits with private flood insurance.
Does flood insurance cover rain damage?
Flood insurance only covers floodwaters that flow into your home from the ground, so rain damage likely wouldn’t be covered under this policy. However, it would likely be covered under your homeowners insurance, since a standard policy generally covers wind-driven rain during or in the immediate aftermath of a hurricane or windstorm.
Does flood insurance cover foundation repairs?
Flood insurance covers direct flood damage to the structure of your home, including its foundation. If you notice cracks in your foundation after a flood event, it may be due to the fact that the waters pulled soil away from it, which caused settling and other issues. If your insurer determines the damage was directly caused by flooding, you’ll likely be covered for foundation repairs. However, they likely won’t reimburse you for the damage if they determine it was the result of negligence or wear and tear.
How much does flood insurance cost?
NFIP flood insurance costs $738 per year on average, or $62 per month, but your own premium amount may be significantly more or less depending on your home’s location and how much coverage you need.
