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Understanding What Flood Insurance Covers

In the event of a flood, home insurance won’t cover your damages. Learn here how flood insurance picks up the slack.

flood water in home

Flood insurance covers your house and belongings to a set limit in the event of a flood. If you live in a high-risk flood zone, purchasing flood insurance could be a necessity, especially if you have a government-backed mortgage.

Standard flood insurance through FEMA's National Flood Insurance Program has set coverage limits, but some private insurers offer higher limits. There are pros and cons to dealing with private insurers for flood insurance, so be careful with that course of action.

This article will detail:

What does flood insurance cover?

The structure of your home is covered under the building coverage portion of your flood insurance policy. Your possessions are covered by the contents coverage section of the policy. Basements have limited coverage, mostly because rooms under the ground level of the house run a high risk of flood damage. Exclusions to flood insurance coverage usually include landscape damage, some forms of valuables and personal liability.

Building coverage

This portion of a flood insurance policy covers the structure and built-in systems of your home for repair or replacement due to flood damage. This includes:

  • The structure of your home.
  • The foundation and foundation walls.
  • HVAC systems and water heaters.
  • Plumbing and electrical.
  • Appliances such as refrigerators, ovens and built-in units such as dishwashers.
  • Permanent carpeting over unfinished flooring.
  • Permanently installed wallboard, wall paneling, bookcases and cabinetry.
  • Detached garage (covered up to 10% of your flood policy value).
  • Window blinds.
  • Debris removal after a flood.

Contents coverage

Your belongings covered by flood insurance include:

  • Furniture, clothing and electronics.
  • Curtains.
  • Portable AC units, microwaves and dishwashers.
  • Carpentry not covered under dwelling coverage.
  • Standing washers and dryers.
  • Freezers and food contained within.
  • Up to $2,500 max in valuables, such as art and furs.

Does flood insurance cover my basement?

The dwelling and contents coverages for basements under a flood insurance policy are minimal. Coverage for dwelling and personal property in a basement includes:

  • Furnaces, air conditioners and heat pumps.
  • Electrical junction and circuit breaker boxes.
  • Well water tanks, pumps and cisterns.
  • Oil and gas tanks and their contents.
  • Sump pumps.
  • The foundation.
  • Stairways and elevators.
  • Post-flood cleanup.
  • Washers and dryers.
  • Food freezers and contents.
  • Unpainted drywall, ceilings and insulation.

Flood insurance exclusions

Damage due to water from non-flood sources isn't covered under flood insurance. For example, if water leaks through your roof during heavy rains, the damage wouldn't be covered by your flood insurance policy.

You're also responsible for damage costs beyond the maximum payout of your flood insurance. There is, however, excess flood insurance available through private flood insurance companies. In order to get excess flood coverage, you must already have NFIP flood coverage.

Since flood insurance focuses on protection for the home itself, landscape and outdoor items outside the home like trees, lawns, swimming pools and patios aren't covered. Mold and mildew not caused by flood damage isn't covered either.

An important exclusion to consider is that flood insurance doesn't cover additional living expenses (ALE) if you have to move while repairs are being made. Ask your home insurer what options may be available for ALE coverage. Flood insurance doesn't cover personal liability, either.

Basement exclusions

Flood insurance coverage exclusions in basements and other rooms below the ground level of the house include:

  • Non-drywall walls and ceilings.
  • Personal property including clothing, furniture and electronics.
  • Paneling.
  • Bookcases.

Buying flood insurance through NFIP vs. a private insurer

Flood insurance is regulated by FEMA through the National Flood Insurance Program (NFIP). Home insurance companies that operate in flood-risk areas offer NFIP flood insurance, as well as about 80 private insurers. Flood insurance purchased through insurers directly taking part in the NFIP carries limits of $100,000 for contents coverage and $250,000 for residential building coverage. Using an NFIP-affiliated insurer tends to be the most common means of buying flood insurance, but private insurers are an option as well.

Getting flood insurance through a private insurer has pros and cons. The advantage of a private flood insurance company is that you can get better coverage limits. The disadvantage is that private flood insurance companies can drop or not renew your coverage, while NFIP insurers will maintain your policy as long as you pay the premium.

Being dropped from a private provider doesn't disqualify you from getting NFIP flood insurance directly, but NFIP has a 30-day waiting period.

How much does flood insurance cost?

We found that flood insurance costs $699 per year on average. This rate may vary depending on age, market value and flood risk of your home. You can find out the flood risk where your home is located by checking the FEMA Flood Map for your area.

If you make four or more claims at $5,000 per claim, or two claims that together equal the cost of your home, NFIP may offer you a grant to prevent flood damage. If you choose not to take the grant and fix your home, you will probably see a premium hike in your flood insurance.

The 30-day wait for flood insurance

It's important to know that flood coverage does not activate until 30 days after purchase of the policy. Any flooding to the home during that time period is not covered. There are some exceptions to the 30-day waiting period:

  • If you purchase flood insurance from a private insurer, the wait time may be reduced to around 10 to 14 days. Not all states and communities have private flood insurers. Ask your home insurer for possible options.
  • If your flood insurance is part of a mortgage loan, there is no waiting period.
  • If you're increasing coverage on a flood insurance policy you already own.
  • If a house is in a newly designated risk area and you purchase flood insurance within 13 months after revision, there is a one-day wait.
  • If a flood affects property on burned federal land and you buy a policy within 60 days of the fire containment date, there might not be a waiting period. The waiving is determined when the claim is made.
  • If you're switching from a NFIP flood policy to a private policy, there may be a shorter waiting time.

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