Flood Insurance 101: Separating Fact from Fiction

Floods are a silent but powerful force, representing the most common of all natural disasters. Despite this fact, there are many myths and mysteries surrounding flood insurance that leave countless families and businesses vulnerable. Understanding the truth about this essential coverage is the first step toward protecting yourself and your property. Here are the answers to some of the most frequently asked questions about flood insurance.

Is flood insurance just for homeowners? No, not at all. While homeowners should definitely consider flood insurance, renters and business owners also face significant risks from flooding. Water damage can be devastating regardless of whether you own or rent the property, or whether it’s for personal or commercial use.

Is flood insurance a part of a basic property insurance policy? This is one of the most common misconceptions. A standard homeowners, renters, or business insurance policy does not include flood protection. Flood insurance is separate coverage that is made available through the National Flood Insurance Program (NFIP), which is administered by FEMA and sold by licensed insurance agents.

Why aren’t floods covered under a standard homeowners insurance policy? Homeowners’ policies are typically designed to cover sudden and accidental events. Flooding is considered a gradual event. This is why many flood insurance policies must be purchased up to 30 days in advance of when they take effect—to prevent people from buying coverage only when a flood is imminent.

What is considered a flood? A simple, general description is that flood waters are those that have touched the ground before entering a home or building. This distinguishes it from other types of water damage, such as a burst pipe, which would typically be covered by a standard policy.

Should only those in high-risk flood zones acquire flood insurance? Absolutely not. Flooding can happen almost anywhere. In fact, approximately 25% of all flood insurance claims each year come from properties located outside of high-risk flood zones. Changes in local construction, new developments, and even climate change can alter flood risks over time, making it prudent for everyone to consider coverage.

Do flood risks change? Yes, they do. The same factors that contribute to floods outside high-risk zones, such as new road construction or building developments that change natural drainage patterns, can alter the risk for your property. It’s a good idea to periodically check area flood zone maps for updated data. These changes are an excellent reason to have an annual home insurance review.

Is flood insurance expensive? The cost of flood insurance is directly related to your property’s risk. Properties in higher-risk flood zones will naturally have higher premiums, but the cost of coverage is often a fraction of the cost of repairing the damage from a single flood event.

If you’re interested in learning more about flood insurance and its benefits, contact one of our independent home insurance agents today. They can help you determine your specific risks and provide a no-obligation quote for the coverage you need. We are here to help you protect your most valuable assets.