Navigating the Waters: A Homeowner’s Guide to Flood Insurance

Insurance that covers flooding damage protects your property from weather events involving excess rain. Learn about coverage options and how to file claims.

Coverage for flooding damage isn’t typically included in standard homeowner insurance plans. Separate flood insurance is usually required for water damage caused by natural disasters such as hurricanes, storm surges, or heavy rain events.

Does Homeowners Insurance Cover Flood Damage?

Homeowners insurance doesn’t usually cover floods, and separate flood insurance is required to handle major water-related events. While a policy may cover natural disasters, specific language in the insurance contract typically limits coverage caused by specific events, such as wind, fire, or lightning strikes. 

Flood insurance specifically covers damage caused by flooding, including damage to the building structure as well as damage to electrical systems, appliances, and other interior systems damaged by a flood. 

Understanding Flood Insurance

Homeowners in flood-prone areas may be required to have a separate flood insurance policy if the home has a mortgage. 

In low-risk areas, homeowners may be able to add endorsements to an existing insurance policy that offers limited flood coverage.

Flood Damage and Home Insurance

Flood insurance is specifically designed to cover incidents where water on the ground moves into a structure located on ground that isn’t normally covered by water. This doesn’t include things like interior leaks caused by a broken pipe or rainwater leaking into the house due to roof damage.

Damage caused by flooding and covered by flood insurance can include:

• Structural damage to the foundation, floor, walls, ceilings, and roof.
• Damage to interior fixtures, such as water heaters, electrical and plumbing systems, or built-in appliances and cabinetry.
• Damage to the contents of the home, including furniture, freestanding appliances, and personal items.

One notable exception to flood coverage is that it doesn’t usually include loss of accommodations. Your regular homeowners policy may cover temporary accommodations during rebuilding or renovations, but this isn’t offered in flood insurance policies.

Other things that aren’t covered by flood insurance include:

• Damage to outdoor structures such as decks and sheds
• Vehicles damaged in a flood
• Mold and mildew growth that could have been prevented by taking precautions before the event
• Damage caused by burst pipes or sewage backup, though these may be covered by your regular homeowners insurance

Flood Insurance Policies and Coverage Limits

Insurance policies that cover flooding damage typically have specific limits on the amount and type of damage covered. These coverage limits include a specific maximum dollar amount to be paid out in the event of a flood.

Most insurance policies, including flood insurance policies, include a deductible that must be met before coverage begins. Damage that costs less than the deductible must be paid by the homeowner, and the insurance company only starts issuing payments once the damage goes over this amount.

The National Flood Insurance Program (NFIP), managed by the Federal Emergency Management Agency (FEMA), was designed to provide government-backed insurance for flooding damage in specific flood-prone areas in the US. ^[1] Individual policies are offered by private insurance companies and backed by federal funding.

Private flood insurance, which is not backed by government funding, is also available. While the limits on claims under the NFIP are capped at $250,000 per home for damage to the dwelling and $100,000 for damage to home contents, private insurance may offer larger caps on coverage. You can also have both, using the NFIP coverage for the first $250,000 worth of damage to the building and purchasing additional coverage to handle any damage above that amount. 

The deductible for NFIP-managed flood insurance plans ranges from $1,000 to $10,000, and choosing a higher deductible may lower your monthly premiums. The NFIP program also includes a waiting period of 30 days before your flood insurance goes into effect, so you shouldn’t wait until a major storm is on the way to make your purchase.

Filing Insurance Claims for Flood Damage

Filing a flood insurance claim is similar to filing a claim for general homeowners insurance. You need to contact the insurance company as soon as possible after damage occurs, work with the insurance assessor to determine how much of the damage is covered, and arrange timely repairs on your property once the insurance claim is processed. 

Flooding often occurs in conjunction with other natural disasters, such as hurricanes or major storms, so there may be some question about which damage is covered by flood insurance vs. homeowners insurance. As an example, a storm that involved heavy wind, rain, and ground flooding due to river or stream overtopping may cause multiple forms of damage. The same house may have wind-caused roof damage covered by homeowners insurance and water damage caused by a tidal surge that is covered by flood insurance. 

Practical Guidance and Next Steps

Purchasing Flood Insurance

One major consideration for whether you need flood insurance is whether your home is located in a federally identified flood zone. The FEMA Flood Map Service Center has a tool that allows anyone to input an address and determine the flood zone of that location. ^[2]

If your home requires flood coverage, you can choose NFIP-backed flood insurance or private insurance. Private insurance may offer higher coverage limits, more robust coverage, and a shorter wait time before the policy goes into effect. 

Contact your current homeowners insurance company or insurance agent to purchase flood insurance. 

Preparing for Floods

If your home is in an area prone to flooding, prepare ahead of time by safeguarding belongings and creating a plan for evacuation. Moving loose items off the floor and onto raised surfaces may help protect against loss. Using sandbags to keep water out of your home may keep the interior safe from low-level flooding.

Showing that you prepared for potential flooding may make your claim go smoother if damage does occur.

Filing a Flood Insurance Claim

The general process to file a claim involves:

1. Assessing the damage caused by flooding
2. Contacting the insurance company that provides your flood insurance, which is typically separate from your homeowner’s insurance provider
3. Completing any forms necessary to begin the claims process
4. Taking steps to mitigate further damage, if possible
5. Arranging for temporary accommodations if necessary and beginning the process of filing a claim to cover your immediate living expenses
6. Gathering documentation, such as lists of home contents and photos, to record the damage and support your claim
7. Arranging a meeting with the insurance assessor who can inspect the damage and make a determination about your claim
8. Getting repair estimates from multiple sources to ensure an accurate monetary assessment of the cost of repair
9. Checking over the settlement offer once provided by your flood insurance company to verify it is accurate
10. Starting repairs on your home and tracking costs during the process to ensure everything is properly covered

It’s a good idea to give your insurance assessor an organized list of everything that was damaged and how the damage occurred. Here is a checklist for documenting flood damage:

• Describe the source of the water and how it entered the home
• List all signs of water damage anywhere in the home interior and exterior, including puddles, stains, mold, water lines indicating the depth of flooding, and musty odors
• Document damage to electrical, natural gas, sewage, and plumbing systems caused by the flood
• List specific damage to walls, ceilings, flooring, and appliances
• Describe any mitigation efforts taken to reduce future damage, such as water removal efforts and ventilating the property to prevent mold and mildew growth

Assessing Your Needs

Flood insurance coverage is mandatory in some circumstances and locations, and it may be advisable in other situations. Mortgage holders often require flood insurance for homes in risk-prone areas, so talk to your bank or financing company to determine if this is a requirement for your mortgage. 

Assessing your insurance needs on a regular basis ensures you always have the coverage you require. Make it part of your annual preparedness plan to check your flood zone and map out a plan for any potential flood dangers in your area.

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Reviewed by Gerard Reczek

As an Excess and Surplus Lines Insurance Specialist, Gerard Reczek has over forty years of experience as a broker and underwriter for clients with hard to place risks, providing deep policy analysis and thoughtful client solutions. He holds MA Resident Individual Producer and Surplus Lines Broker Licenses.