Do I Need Flood Insurance?

Did you know that your homeowners insurance does not cover water damage due to natural flooding? Overflowing rivers, tidal surges, city storm drain backups, and storm driven rain may flood your home but unless you have specific coverage against these perils, you’re likely on your own.

In addition to natural flood disasters, your homeowner’s insurance policy most likely specifically excludes flooding due to sewer backups and “seepage.” Some insurance companies do offer special endorsements for coverage due to sewer backups. If you want this type of coverage, call your insurance agent and see if it’s available. Water seepage is considered a maintenance issue and is not generally covered by insurance. Your best protection against water seepage is to evaluate and maintain your home.

Flood insurance is available to cover your home against flooding. This type of insurance is often referred to as a “single peril” policy. The National Flood Insurance Program offers policies covering natural flooding such as storm surges, snow melt, heavy rains, levee failures, blocked storm drains, and other flood events. However, a flood must be significant enough in order for the flood insurance to kick in. For example, the floodwaters must either affect two or more properties or cover at least two acres.

Some lenders require flood insurance policies, normally if you live within a designated flood plain. Flood hazard maps are used to determine a property’s risk. High risk properties need a standard policy.

If you don’t live in a flood plain, you probably won’t be required to obtain a flood insurance policy. However, flood insurance is available for low to moderate risk properties. Nearly 25% of all flood insurance claims are located in these lower risk areas. Policies for low-to-moderate risk properties are less expensive. These policies are called “preferred risk” policies.

You can purchase flood insurance from your own insurance agent or locate an approved insurance agent through the Web site. Shopping around for flood insurance isn’t necessary because rates are set by the National Flood Insurance Program and are based on flood maps.