With the record setting snowfalls and torrential rains storms in 2018-2019, I’ve been asked this question quite a bit.
Several areas in the Northeast and Midwestern U.S. are expecting flooding this spring as the snow melts and travels downstream.
You Can Buy Flood Insurance From Agents or the Government
The good news is you can purchase flood insurance from the federal government or through independent insurance agents who sell flood insurance through private insurers.
Of course, the federal government backs them financially if necessary (in the event claims exceed premiums).
You should act as soon as possible if you are interested in coverage for your home or business, as there are requirements that need to be met in order for you to be eligible for coverage (Do I need flood insurance?).
First, your community will have to participate in the National Flood Insurance Program (NFIP), which sets requirements for flood control measures and land use.
Your insurance agent should be aware if your community participates in the plan.
If your community doesn’t participate in the NFIP, you’re not out of luck.
Communities can enter the “Emergency Program” and receive temporary, limited coverage, while the government studies your area in order to make recommendations for limiting potential losses.
There is a 30-day waiting period for all policies. Limited coverage amounts under the “Emergency Plan” are as follows:
– Single Family Homes – up to $35,000 for the structure
– Single Family Homes – up to $10,000 for the contents
– All other properties (commercial and residential) – up to $100,000 for the structure
– All other properties (commercial and residential) – up to $100,000 for the contents
Once the evaluation of your community is complete, you will be eligible to participate in the “Regular Program,” which provides higher coverage limits, listed below:
– Single Family Homes – up to $250,000 for the structure (includes $35,000 from “Emergency Plan”)
– Single Family Homes – up to $100,000 for the contents
– All other properties (commercial and residential) – up to $500,000 for the structure and contents
There are also so-called “excess flood markets” available through private carriers if you need more coverage.
The deductible on this program is standardized at $500, however, similar to other lines of insurance, the deductible can be increased as a means to lower the overall premium.
Single-family homes must be have coverage limits of at least 80% of the value of the home to qualify for replacement cost coverage of the dwelling.
The contents are covered as Actual Cash Value (ACV). Commercial and other residential properties (apartment buildings for example) are covered as ACV for the property and the contents.
Of course, there are exclusions to what can be covered under this policy.
Items covered by other insurance policies, such as cars and airplanes, are not covered, as well as trees, shrubs and “other structures” as defined by most property policies.
Ultimately, this coverage is designed to pay for damages to your physical dwelling and contents of your home only.
Check out more Flood insurance FAQs.