How does flood insurance work?

Typically, homeowners insurance companies won't cover water damage as a result of a flood. If you live in a higher-risk flood zone, you may want to purchase flood insurance from the National Flood Insurance Program (NFIP) or from a private flood insurer.

What does flood insurance cover?

Depending on your policy, flood insurance typically covers the structure of your home and the contents in it, including:

  • Your home’s foundation and structure
  • Garage and other detached structures
  • Personal property, including furniture, clothing, and electronics (actual cash value)
  • Built-in appliances, including refrigerators, dishwashers, and stoves
  • Permanently installed carpeting and household fixtures
  • Air conditioning unit and furnace
  • Plumbing and electrical systems
  • Up to $2,500 in valuables such as jewelry and art and collectibles
  • Debris removal

The National Flood Insurance Program (NFIP) offers up to $250,000 in coverage for your home's structure and up to $100,000 for your belongings. If you need higher limits because your home has a high property value, you may purchase a policy from a private flood insurer. Private flood insurance may either supplement your NFIP policy or completely replace it.

Through the NFIP, homes are covered on a replacement cost basis while your personal property is insured for the actual cash value. That means the NFIP will typically pay you the actual value of your covered belongings. For instance, it may cost $1,000 for a brand-new couch of similar quality to replace the one you lost in a flood. However, if your couch was worth $600 at the time of the covered loss, that's the amount you'll receive from the NFIP. If you choose a private insurer for flood insurance, they may cover your personal property at replacement cost.

What does flood insurance NOT cover?

Whether you buy a flood policy from the NFIP or a private company, the following exclusions may apply:*

  • Damage from sewer line backups or to your sump-pump
  • Motor vehicles (car, ATV, motorcycles, watercraft, etc.)
  • Floodwater damage leading to mold and termites
  • Financial losses you might suffer from not being able to conduct your home-based business
  • Stock certificates
  • Cash and jewelry up to specified limits
  • Swimming pools, outdoor hot tubs, and patios
  • Landscaping

Do I need flood insurance?

As a condition of the loan, your mortgage lender may require you to purchase a flood policy if you live in a high-risk area. Otherwise, you're not required by law to purchase one. FEMA estimates that an inch of water could cause $25,000 of damage to your home.

Even if you don't live in a high-risk flood zone, heavy rain, melting snow, and severe coastal weather may cause flooding. Moreover, 20% of flood claims come from low- or medium-risk areas — so flood insurance is often an important safeguard for many homeowners living near a river or body of water.

Renters insurance and flood damage

Renters insurance policies won't cover damage resulting from a flood. To protect your personal property against flood damage, you'll need a separate flood insurance policy. However, you'll only need to cover your belongings on your flood policy and not the actual residence. It is your landlord's responsibility to insure the structure you live in.

Car insurance and flood damage

If you carry comprehensive coverage on a car damaged from flooding, your auto insurance policy may pay to repair or replace your vehicle. A deductible typically applies.

How much does flood insurance cost?

Flood insurance policies from the NFIP cost around $700 annually. Like any type of insurance, your rate will depend on the risk. You'll obviously pay more if you live in a high-risk flood zone or an area prone to flooding. Premiums for private flood insurance companies will vary greatly based on location (how close is your home to the water's edge?), elevation, and the coverage limits you select.

How to buy flood insurance

Speak with your agent or insurance company to find out how you can purchase a flood policy. You may also get a flood insurance quote online through Progressive.