Flooding is among the most common and costly disasters in New Jersey, yet it's not covered by standard homeowners insurance. However, you can buy flood insurance from the government-backed National Flood Insurance Program (NFIP) or any of the nearly two dozen private companies that offer it in New Jersey. Here's what you need to know about flood insurance in New Jersey.
In this article
How much is flood insurance in New Jersey?
The average cost of NFIP flood insurance in New Jersey is $930 a year, or $78 a month, but your flood zone goes a long way toward determining your rate.
Private flood insurance rates vary by carrier. Those with properties in high-risk flood zones pay an average of $113 a month for NFIP insurance, compared to $55 a month for homes in low- and moderate-risk areas. You can find the flood risk for your own home or one you want to buy online in the Flood Map Service Center on FEMA's website. Flood zones that begin with the letter A or V are high risk. Zones labeled B, C and X are low and moderate risk.
| Flood zone | Average monthly cost | Average annual cost |
|---|---|---|
| NFIP flood insurance in all New Jersey flood zones | $78 | $930 |
| NFIP flood insurance in high-risk areas (zones beginning with A or V) | $113 | $1,351 |
| NFIP flood insurance in moderate- and low-risk areas (zone X) | $55 | $656 |
| Source: FEMA | ||
How does private flood insurance work in New Jersey?
Some private flood insurance companies in New Jersey offer more coverage than the NFIP, and some private companies offer a lower rate than the NFIP. Private insurance companies use different modeling systems than FEMA does to assess the flood risks of homes. Depending on a company's rating system and your location, you may qualify for a better rate for private flood insurance than you do for an NFIP policy.
Private flood insurance vs. NFIP coverages
Many of New Jersey's private flood insurance companies offer higher dwelling and personal property coverage limits than NFIP's maximums of $250,000 for building coverage and $100,000 for contents.
If the value of your home and/or possessions exceeds the NFIP's maximum limits, an NFIP policy may not cover all your expenses in the event of a major or total loss.
Many private flood insurance companies also offer loss of use coverage, which is unavailable through the NFIP. Loss of use covers temporary living expenses while your home is being repaired.
What does flood insurance cover?
NFIP flood insurance includes building coverage for your home and contents coverage for your belongings. If you rent your home, you can purchase contents-only coverage.
In addition to the structure of your home, building coverage protects systems and items such as:
- Electrical and plumbing systems
- Furnaces and water heaters
- Refrigerators, stoves and built-in appliances
- Permanently installed carpeting, cabinets, paneling and bookcases
- Detached garages
Contents coverage applies to belongings such as furniture, electronics, clothes and certain other items, including:
- A washer and dryer
- Portable and window air conditioners
- Microwave ovens
- Up to $2,500 for valuables, such as original artwork and furs
Is flood insurance required in New Jersey?
Flood insurance is typically required for mortgages in high-risk flood zones, but the prevalence and costs of flooding in New Jersey make it worth considering in many situations when it's not required for a loan. The average payment for a NFIP flood insurance claim in New Jersey is $27,229.
One only needs to look back to the devastation that the remnants of Hurricane Ida caused throughout the state in 2021 to understand how floods can strike in areas not traditionally prone to flooding.
FEMA reports that more than 20% of its flood insurance claims nationwide come from outside high-risk flood zones.
Flood insurance in New Jersey's SFHAs
AE flood zones or any zone appointed with the letters A or V have a 1% chance of flooding annually. If you live in one of these zones and have a federally backed mortgage, you are required to purchase flood insurance.
Frequently asked questions
NFIP and private flood insurance is widely available through local agents serving most New Jersey communities, so it’s best to start shopping with your current home insurance agent.
If you increase your deductible, you can lower your premium. You may also be able to lower your premium by submitting an elevation certificate to your agent. An elevation certificate gives details of your home's location, the elevation of the lowest floor, the characteristics of the building and which flood zone in which it is located.
Updating your home can also help lower your premium. Elevating your home and utilities, installing flood openings and filling in your basement may help you save on your premium.
Methodology
We sourced our data from FEMA. The average costs of NFIP flood insurance are based on policies in force as of November 30, 2022.
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