Does Insurance Cover Flood Damage?

When considering the protection of your property, understanding different types of insurance, and what they cover and exclude, is crucial. A commonly misunderstood type of damage is flood damage. So, does insurance cover flood damage? In this article, we'll help explain the interplay between different types of insurance and coverage for flood damage.

Homeowners Insurance Policies

Typically, homeowners insurance policies do not cover all flood damage. Homeowners insurance policies generally cover water damage from internal sources, such as a burst pipe or an overflowing washing machine. However, homeowners insurance policies generally exclude damage caused by external water sources, such as floods from heavy rain, storm surges, or overflowing rivers.

Auto Insurance Policies

Typically, a comprehensive auto insurance policy covers damages to your car resulting from certain types of flooding events (such as flooding as the result of a storm) but generally will not cover all types of water damage (such as a maintenance issue or leaving your window open in a rainstorm). Third party liability coverage types of auto insurance, such as liability and collision coverage, do not cover flood damages. 

Understanding Flood Insurance for Homes

To help protect yourself from the financial obligations which may be associated with flood damage, you should consider a separate flood insurance policy. The National Flood Insurance Program (NFIP), managed by the Federal Emergency Management Agency (FEMA), offers flood insurance to property owners, renters, and businesses in participating communities. Private insurers also offer flood insurance policies, which can sometimes provide more comprehensive coverage or higher limits than NFIP policies and can help homeowners in areas not covered by the NFIP.

What Does Flood Insurance Cover?

While the terms and conditions of a particular policy can vary, flood insurance typically covers damages to the structure of your home, and personal property within it, resulting from a covered flood event. For the structure, this may include the building and its foundation, electrical and plumbing systems, HVAC equipment, kitchen appliances, and permanently installed carpeting and paneling. For personal property, coverage for clothing, furniture, electronics, and other personal items may be provided.

However, it's important to understand the limits and exclusions of your policy. For example, NFIP policies generally do not cover temporary living expenses if you have to move out of your home while it's being repaired, while many private flood insurance policies do offer this coverage. Additionally, coverage for basements, crawl spaces, and lower floors may be limited or excluded on both NFIP and private flood insurance policies.

Why Flood Insurance Is Important

Floods can happen virtually anywhere, not just in high-risk flood zones. In fact, according to FEMA, over 20% of flood claims come from properties outside of high-risk areas. More severe and unpredictable weather patterns appear to have increased the risk of flooding in many regions. This makes flood insurance an important component of a comprehensive risk management strategy for homeowners. Read more about why flood insurance is important.

How to Purchase Flood Insurance

Purchasing flood insurance can be relatively straightforward. If you're interested in an NFIP policy, you can contact your insurance agent to help you determine your coverage needs and provide a quote. If you prefer to explore flood insurance policy options from a private insurance company, you can compare quotes from different companies to find a policy that suits your needs and budget. Read more about why you should buy flood insurance.

The Bottom Line

Understanding the specifics of your personal insurance coverage is essential for helping to protect your property and financial well-being. While standard homeowners insurance policies typically do not cover flood damage, purchasing a separate flood insurance policy can help protect your home and personal property from the additional risks associated with flooding events.  Given the apparent increasing risk of flooding due to changing weather patterns, now is an excellent time to review your insurance coverage and consider adding flood insurance to your protection portfolio.

Acrisure can help you find the right flood insurance policy for your home and personal property needs as well as provide you with comprehensive auto insurance solutions to help cover flood damage to your car. Contact us with any questions, or get started by requesting a flood insurance quote or comprehensive auto insurance quote today!