Homeowners Flood Insurance Coverage

Why Have Flood Insurance

You don’t need to live near the water to be at risk for flood damage as flood damage can be unforgiving. Only a few inches of water is all it takes to cause major damage to your property. According to the National Flood Insurance Program (NFIP), nearly 20% of flood insurance claims come from moderate to low-risk areas of the country, meaning there are far more people at risk than you might think. It’s important to know that a homeowners policies generally cover loss or damages from a flood. Due to the nature of flood damage flood insurance requires a separate policy for certain property types such as tool sheds and detached structures.

Property Types

  •  Single Family Residents (Owner Occupied, Vacation, Rental & Investment)
  •  Duplex
  •  Triplex
  •  Fourplex
  •  Townhomes
  •  Condo Units
  •  Detached Garage
  •  Tool Sheds
  •  Mobile Homes
  •  Manufactured Homes

Federal Flood Insurance Program Covers

  • Building property policy covers the cost to rebuild or the actual value of your home (whichever is less)
  • Your home and its foundation
  • Electrical and plumbing systems
  • HVAC equipment like air conditioning, furnaces, and water heaters
  • Kitchen appliances, including your refrigerator, stove, and built-ins such as your dishwasher
  • Permanently installed carpeting over an unfinished floor
  • Permanently installed wallboard, paneling, bookcases, and cabinets
  • Window blinds
  • Detached garages (limited to 10% of your home policy)
  • Debris removal
  • Water heater

Personal Property Coverage 

  • Clothing, furniture, and electronic equipment
  • Curtains
  • Window AC units
  • Portable microwaves and dishwashers
  • Carpets not covered by your building policy
  • Washer/dryers
  • Your freezer and frozen food
  • Up to $2,500 in valuables, such as art and furs

 Personal possessions claims are paid based on actual cash value — not what you paid for them.

What Isn’t Covered

  • Precious metals
  • Stock certificates
  • Bearer bonds
  • Cash
  • Trees
  • Plants
  • Wells
  • Septic systems
  • Walkways
  • Decks
  • Patios
  • Fences
    Hot tubs
  • Swimming pools
  • Boat houses
  • Retaining walls
  • Storm shelters
  • Temporary housing and other living expenses
  • Loss of income
  • Cars
  • Post-flood mold damage (more about insurance and mold here)
  • Sewer backups (not caused by flooding)

Coverage is Limited for Basements

If you have a basement, you’ll have more risk because the NFIP limits coverage for basements, crawlspaces, or any living space where the floor is below ground level. Even a walkout basement won’t be covered for:

  • Bookcases
  • Window treatments
  • Carpeting, tile, and other floor coverings
  • Some drywall
  • Paneling
  • Walls and ceilings not made of drywall
  • Most personal property such as clothing, electronic equipment, kitchen supplies, and furniture

There’s a Limit to How Often You Can Collect

If you make four or more flood claims for more than $5,000 each, or two claims that, added together, cost more than your home, NFIP may “offer” you a grant to make your home less vulnerable to floods. If you refuse to take the grant money and make the improvements, your policy payments will probably increase substantially.

More About What Qualifies as a Flood

As mentioned earlier, regular homeowners insurance doesn’t cover floods. So when is damage considered to be caused by a flood? Water has to cover at least 2 acres of land that’s normally dry, or has to have damaged two or more properties (one being your home). Also water that come from:

  • Overflowing inland or tidal waters
  • Unusual, rapid accumulation or runoff of surface waters from any source
  • Mudflow (that’s mud carried by a flow of water, creating a river of mud)
  • You’re also covered when shore-front land collapses or sinks due to waters above “anticipated cyclical levels.”
  • Water and seepage that comes from sewer or drain backups, or a sump pump that overflows is not considered a flood.

30-Day Waiting Period

Don’t wait for an impending storm to purchase federal flood insurance. There’s usually a 30-day waiting period. Make an inventory of the possessions in your home to make filing a claim easier.