Flood Insurance Center
Protect yourself from the damaging effects of excess water.
Flood insurance covers losses to your property when it is affected by “excess water” on property that is normally dry. That is the general definition. You do not have to live in a Gulf state to be at risk.
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Q: What is flood insurance?
A: Flood insurance covers losses to your property when it is affected by "excess water" on property that is normally dry. That is the general definition. You do not have to live in a Gulf state to be at risk.
Q: Why buy flood insurance?
A: Flood insurance is required if your property is in a high-risk zone and you have a home loan from a federally-regulated lender (most banks). You will also need flood insurance if your lender tells you that your property has been re-zoned as a high-risk area.
FEMA (Federal Emergency Management Agency) estimates that about 25% of flood insurance claims are filed from medium and low-risk zones. So, even if your flood risk is minimal, you may still want some coverage - especially since floods are the most common natural disaster in the U.S. and your homeowner's hazard insurance policy won't cover floods.
Q: What are common causes of flooding?
- Overflow of inland waters
- Rise in tides
- Unusual and rapid accumulation or runoff of surface water from any source
- Mudflow (earth carried by water currents)
- Land collapse along lake shores or other bodies of water that is caused by erosion, waves or currents resulting from non-cyclical flood waters
Q: To be covered by flood insurance, what must occur?
- The flood must be a temporary condition, and
- Cover two or more acres or two or more properties
The National Flood Insurance Program (NFIP) offers coverage in approximately 20,000 communities in the U.S.
You can determine if your property is eligible for flood insurance by checking the NFIP Community Status Book.
Three policies are available, depending on the type of structure you want to insure:
- Dwelling Policy - covers most residential homes
- General Property Policy - covers apartments and businesses
- Residential Condominium Building Association Policy - covers condominiums
Basic flood insurance policies cover structures only. If you want to insure your personal belongings against flood damage, you must buy separate coverage.
Q: How can I learn more about my property's flood risk?
A: Everyone lives in a flood zone. Some areas are simply considered low-risk. FEMA determines flood zones by reviewing:
Understand your flood zone.
- flood history
- river flow
- wind velocity
- tidal surge
- flood control measures
- building development
Calculate your property's risk for flooding using FEMA's risk assessment tool.
Know your area. You can view a flood map of your property to understand potential water hazards. Talk to your real estate professional If you are working with a real estate professional, find out what your agent knows about the area's flood risk and discuss whether the seller has disclosed a flood problem. Be sure to ask if disclosure is required by your state. Talk to your home inspector Ask your home inspector about any water damage that shows up in the inspection report. Talk to an insurance agent Contact your insurance agent or find one who is familiar with your area. Ask your title agent if he or she handles flood certifications.
Q: What's covered?
A: If your property is damaged by a type of flood listed in your policy, your flood insurance will cover:
- The building and its foundation
- Electrical and plumbing systems
- Central air conditioning, furnaces, water heaters
- Refrigerators, stoves, dishwashers
- Permanent carpeting that has been installed over unfinished floors
- Permanently installed paneling, wallboard, bookcases and cabinets
- Window blinds
- Detached garages (up to 10% of coverage)
- Debris removal
If you buy additional coverage for your personal belongings, these items will be covered:
- Personal belongings, such as:
- Electronic Equipment
- Portable and window air conditioners
- Portable microwave ovens and dishwashers
- Carpets that are not included in building coverage
- Washers and dryers
- Freezers and the food they contain
- Certain valuables, such as artwork and furs
Q: What's not covered?
A: Flood insurance policies cover only specific types of flooding. These policies also exclude coverage on some belongings and property features.
Common items that are not covered:
- Damage caused by wind-driven rain
- Damage caused by moisture, mildew or mold that the property owner could have prevented
- Currency, precious metals, stock certificates, and other precious papers
- Vehicles and their parts
- Outside belongings, such as:
- Septic systems
- Hot tubs
- Swimming pools
- Temporary housing and living expenses
- Financial loss due to business interruption
- Financial loss due to loss of use of insured property
Flood insurance also limits coverage on damages to basements, crawlspaces, and other enclosed areas under elevated buildings.
If you have a basement, full-story foundation walls, or any type of enclosure below the lowest elevated floor in your home, ask your agent about these limits.
Q: How is my claim calculated?
A: Insurance agents calculate how much you will be paid for your damaged structure and personal belongings based on both actual cash value and replacement value.
Carpeting and all personal belongings are always valued at actual cash value. (Actual cash value is the value of an item minus depreciation.) Here's an example:
If you bought new carpet two years ago for $1,000 and it was damaged recently by a flood, it would not be valued at the original $1,000 you paid. Why? Because it has sustained every-day wear and tear since you bought it and its value has depreciated. Depreciation is when property loses value over time.
The cost to repair or replace covered dwellings is calculated using the replacement value method. This method does not subtract a depreciation amount. However, these conditions must be met before receiving replacement cost value on a flood claim:
- The building must be a single-family dwelling
- You must live in the building at least 80% of the year, and
- Your coverage must be at least 80% of the full replacement cost of the building, or it must be the maximum coverage available under the National Flood Insurance Program (NFIP).
Here are the payment limits you can expect:
Category Structure Limit Contents Limit 1-4 family residence $250,000 $100,000* Other residential structure (detached buildings other than garages) $250,000 $100,000 Business $500,000 $500,000 Renter $100,000
*some personal belongings, such as artwork or furs may have their own limits.
Q: Can I buy additional coverage?
A: If you want to buy more coverage than is offered through the National Flood Insurance Program (NFIP), ask your insurance agent about Excess Flood Protection.
Q: How much does it cost?
A: The amount you pay depends on your property's flood risk, whether you are insuring a residence or a business, and the deductible you choose. Insuring your personal belongings against flood damage also adds to your policy cost.
You can get an idea of the cost by estimating your premiums online.
Then, contact your insurance agent for specific costs, or find an agent in your area.
Q: Are there ways to save on flood insurance?
- If your flood risk is low, ask your insurance agent about a Preferred Risk Policy. This policy provides low-cost coverage for properties located in areas with minimal flood risk.
- If your community has a high level of flood preparedness, you may be eligible for a CRS discount on your policy. Be sure to ask your agent if a CRS discount could apply to your policy. You could save as much as 45% on your premium.
Q: Is there anything else I should know about flood insurance?
- It takes 30 days for a flood insurance policy to become effective. So, don't wait until a storm is brewing to purchase this policy if you think you might need it.
- Keep receipts for expensive items. If you experience a flood, your claims adjuster will be able to process your claim more quickly if you can easily verify the amount you paid for an item.
- If the seller currently has flood insurance coverage on the property you are buying, ask your real estate agent if you can take over the policy at closing.
- Some states don't require disclosure. This means that a seller may not have to inform you of flood issues. Ask your real estate agent about disclosure rules in your state. If they don't apply, ask the seller directly about any flood issues and research flood history in the area if you suspect it may be a problem.
- If you live in a high-risk area, don't assume that federal disaster assistance will meet your financial needs if a flood occurs. Federal disaster assistance is only available in about 10% of weather-related emergencies. And, unlike insurance coverage, disaster assistance is a loan that must be paid back to the government.