What does flood insurance cover?

Standard homeowners insurance policies typically don’t cover flood damage, so you’ll need to purchase an additional policy to protect your home against floods

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Most homeowners insurance policies don't cover flooding. You'll have to purchase separate flood insurance if you want flood protection. (Shutterstock)

While your homeowners insurance is a valuable tool to help protect your home and belongings from disasters and accidents, it doesn’t cover everything. Most standard home insurance policies don’t include flood coverage.

Even if you don’t live in a high-risk flood area, it may be wise to get flood insurance, since floods can occur anywhere. Over 40% of the flood claims the National Flood Insurance Program received between 2015 and 2019 came from low-to-moderate flood-risk regions, according to FEMA.

Here’s what you need to know about flood insurance and what it covers.

With Credible, you can easily compare flood insurance quotes from top insurance carriers.

What is flood insurance?

Though floods are the most common and expensive natural disaster homeowners face, most home insurance policies don’t include coverage for flood damage. You’ll need to purchase a separate flood insurance policy in addition to your homeowners insurance policy to protect your home against water damage from flooding. 

You can purchase flood insurance through the National Flood Insurance Program (NFIP) or directly from a private insurer. 

With a flood insurance policy, your insurance carrier will bear the cost to repair or rebuild your home (after you pay your deductible), and will pay you the actual cash value for your damaged personal belongings. If you buy a policy from a private insurance provider, you may be able to cover your personal property at replacement cost, which doesn’t deduct for depreciation.  

What does flood insurance cover?

With a private flood insurance carrier, your coverage could vary depending on the provider. The NFIP’s Standard Flood Insurance Policy Dwelling Form offers two types of flood insurance coverages:

  • Building Property — This flood insurance policy covers the physical structure of your home up to $250,000, including the following: electrical and plumbing systems, furnaces, water heaters, appliances, permanently installed features like carpeting, cabinets, and bookcases, blinds, and debris removal.
  • Personal Property — This type of NFIP flood insurance covers the belongings inside your home up to $100,000, including furniture, clothing, electronics, microwave, washer, dryer, curtains, portable and window air conditioners, area rugs, and valuable artwork and furs (up to $2,500).

It’s important to note that if you want to cover both your home and belongings, you need to purchase both types of coverage. 


What does flood insurance exclude?

Whether you purchase flood insurance privately or through the NFIP, your flood insurance policy typically only covers damage flooding directly causes. For example, your policy likely doesn’t cover any financial losses you sustain from being unable to operate your home-based business.

Other common exclusions to flood insurance policies include:

  • Housing and additional living expenses while your home is uninhabitable
  • Any property outside your home, including swimming pools, landscaping, wells, decks, patios, and fences
  • Currency, precious metals, or valuable papers
  • Automobiles, tractors, motorcycles, and other self-propelled vehicles

Visit Credible to compare flood insurance quotes from various insurance carriers.

Does flood insurance cover the basement?

Flood insurance provides little to no coverage for crawl spaces and basements. The NFIP specifies a basement as any room with four walls below ground level. Under this definition, a sunken living room or crawl space could be considered a basement. 

A Standard Flood Insurance Policy (SFIP) covers cleanup expenses like pumping out floodwater, and mold and mildew treatment. An SFIP also insures specific items attached to your home and personal items connected to a power source. Items this policy covers include:

  • Furnaces, water heaters, and air conditioning units
  • Fuel tanks
  • Sump pumps, heat pumps, and water tanks
  • Electrical junctions, circuit breaker boxes, outlets, and switches
  • Elevators and dumbwaiters
  • Attached stairways and staircases
  • Foundational support elements

Remember, flood insurance typically doesn’t cover personal items in your basement unless they connect to a power source. For example, it generally doesn’t cover furniture, clothing, and generators in your basement. If you’re unsure about your policy’s coverage, talk to your agent about exclusions and limitations to make a more informed decision.


When is flood insurance necessary?

If you’re purchasing a home in a high-risk flood zone and you have a government-backed mortgage, your lender will require you to purchase flood insurance to comply with federal regulations. Even if you live in a lower-risk zone, your lender may still require you to carry an additional flood insurance policy to protect its collateral on the loan.

FEMA defines high-risk flood zones as areas with at least a 1% chance of experiencing a flood annually. These areas are called Special Flood Hazard Areas, and they have at least a 25% chance of flooding during a standard 30-year mortgage term. FEMA manages and updates Flood Insurance Rate Maps (FIRMs) and makes them available to the public. These maps assess risk and determine the likelihood of a flood occurring in your area. 

Whether or not your lender requires it, purchasing flood insurance may be worth considering to protect your financial investment in your home. One inch of water in your home can cause $25,000 in damage, according to FEMA.

What’s the average cost of flood insurance?

The average cost of an NFIP insurance policy is roughly $700 a year, but you may be able to purchase a policy for under $500 annually if you live in a moderate- or low-risk flood zone. 

As with any type of insurance, your insurance premium will depend on your risk. Factors that could impact your annual flood insurance premiums include: 

  • Flood zone
  • Location, design, and age of your home
  • Type of flood coverage (building and/or contents coverage)
  • Amount of coverage and deductible

The NFIP issues most flood insurance policies. You can visit the National Flood Insurance Program website to see participating insurance carriers where you live.

You can also compare flood insurance quotes for free with Credible.