How to get flood insurance coverage and who needs it

Flood damage won’t be covered by your home insurance policy, but buying flood insurance can offer financial protection beyond home insurance alone. Generally, there are two different ways to buy flood insurance: through the National Flood Insurance Program or through a private flood insurance provider. Most major home insurance companies partner with either the NFIP or a private provider to offer flood insurance to their policyholders. If you’re looking for a policy, Bankrate’s insurance editorial team can guide you through the ins and outs of how to get flood insurance.

How to buy flood insurance

Flood insurance policies are either underwritten by the National Flood Insurance Program (NFIP) or by a private flood insurance provider. Knowing the kind of policy you need will influence how you buy flood insurance.

NFIP policies

The Federal Emergency Management Agency (FEMA) oversees the NFIP. Many home insurance companies partner with the NFIP to offer flood insurance. You may be able to manage your policy through your home insurance provider, but the policy will be underwritten by the NFIP.

To find a company in your state that sells flood coverage, you can use the flood insurance provider tool provided by FEMA. You can also contact your agent or home insurance company to check if they partner with the NFIP. NFIP policies typically come with a 30-day waiting period before they go into effect, so be sure to shop early and secure coverage before you need it.

Rates from NFIP-sponsored policies will be the same regardless of which carrier is helping you navigate the process, as the cost of flood insurance is set by the NFIP and depends on your flood zone. NFIP policies are also pretty inflexible. Coverage limits are capped at $250,000 for buildings and $100,000 for contents, and deductibles are usually $1,000. If a single-family home is insured for at least 80 percent of its replacement cost (or for the maximum amount allowed by the NFIP), the dwelling may be insured for its replacement cost value. All other dwellings and personal property are insured on an actual cash value basis.

Private flood policies

Some home insurance companies may partner with the NFIP, a private insurance company or both. For example, Allstate offers flood insurance through the NFIP and through a partnership with Beyond Floods, a private flood insurance provider. Chubb underwrites its own flood policies through Chubb Flood. If you’d prefer to work with a private flood insurance provider, you may want to speak with an agent from your home insurance company about your options.

If your home insurance company does not offer flood insurance of any sort, you can reach out to a private flood insurance company directly. Here are some of the more popular providers:

• Neptune Flood
• Beyond Floods
• Chubb Flood
• Aon Edge

Working with an independent insurance agent could be helpful if you want to get private flood insurance quotes. Many private flood insurance policies are sold by specialty carriers that an independent agent may have access to. But, keep in mind that private flood insurance premiums are not preset like NFIP premiums, so costs may vary widely depending on your coverage needs.

Private flood policies sometimes offer higher coverage limits than NFIP policies. You might have more opportunities to customize your coverage, too. Plus, the waiting period could be shorter than the NFIP standard of 30 days. Most private flood insurance companies only require customers to wait between 10 and 15 days.

What to know before buying flood insurance

Before requesting a flood insurance policy quote, you may want to know some questions to ask to make sure you are getting the flood coverage you need. FEMA suggests asking your agent the following.

Does my community participate in the National Flood Insurance Program?

NFIP policies are not available everywhere. In order to qualify, your community must participate in the program. Before you decide on an NFIP policy, be sure that one is available to you.

What flood zone do I live in?

Flood zones range from low-risk to high-risk. Technically, everyone is in a flood zone, although your zone may be the lowest possible risk level. It is important to understand your flood risk level to make an informed decision about your coverage. FEMA’s flood map tool lets you put in your address or coordinates to find out what flood zone your property is in.

High-risk areas are marked with zones beginning with A or V, whereas moderate- to low-risk areas are marked as B, C or X. Keep in mind that if you live in a higher-risk flood zone, your mortgage company will likely require a flood insurance policy just like a homeowners insurance policy to account for potential flood damage.

What does a typical flood insurance policy cover?

Flood insurance policies only cover damage from natural flooding, not from an overflowing toilet or broken pipe. If you need more clarification, FEMA’s definition of a flood may help sort things out. According to FEMA, a flood occurs when at least two acres of normally dry land are covered in standing water due to natural events or when standing water occurs due to a collapse of land along the shoreline of a natural body of water.

There are several types of flood insurance, and the kind you have will dictate what’s covered.

Building property coverage

This type of coverage provides financial protection in the event the following incurs damage:

• The structure of your house
• The electrical and plumbing systems
• Central AC, furnaces, vacuum systems, etc.
• Refrigerators and built-in appliances
• Permanently installed carpeting
• Window blinds
• Detached garages

Building coverage is capped at $250,000 for an NFIP policy and has a $1,000 baseline deductible. If you want the items inside your house to be covered under your flood policy, you’ll have to purchase an additional type of coverage: personal property (or contents) flood coverage.

Personal property flood coverage

This covers most personal belongings or anything that is inside the house up to $100,000, including:

• Clothing, furniture and electronic equipment
• Curtains
• Portable air conditioners and window units
• Carpets not included in building coverage
• Washers and dryers
• Food freezers and the food in them
• Valuables like artwork and fur (up to $2,500)

It is important to note that personal property stored in a basement or outside in a yard will not be covered by an NFIP policy. NFIP policies have other notable personal property exclusions:

• Lawns, trees, shrubs and plants
• Fences, retaining walls, outdoor swimming pools and docks
• Underground structures like wells and septic tanks
• Accounts, bills, currency, deeds and money
• Vehicles and aircraft

For some homeowners, it may be worth looking into an excess flood insurance policy. In some cases, excess flood insurance may even cover costs to pay for preventive flood measures or additional living expenses in the event of a covered loss.

Can I get discounts on flood insurance?

While you won’t find the same common discounts on a flood insurance policy that you would for a homeowners insurance policy, there are flood insurance discounts available.

Depending on the building structure and the rating categories you fall into based on FEMA’s designations, you may qualify for one or more flood insurance discounts with the NFIP. Your home or building’s foundation type, first-floor height, built-in flood openings and methods of mitigation all factor into potential discounts. Generally, the higher the building is off the ground, the lower the flood risk and the greater the discount.

You may also be eligible for a discount if you’re a part of any particular FEMA programs or ratings groups — such as the Emergency Program or the Community Rating System (CRS). CRS communities are those that have taken steps to reduce and prevent flood damage to insured properties and developed comprehensive floodplain management.

Rental-specific flood insurance coverage

Businesses and homeowners are not the only ones who need flood insurance; renters may also want to consider what options are available. If you are a renter, you can also get a policy through the NFIP that will cover the contents of your rental up to $100,000. The cost of the policy will depend on where you live, the floor you live on and the flood risk to the property you are renting. If you are located in a low- to moderate-risk area, you may qualify for a Preferred Risk Policy, which will likely be significantly cheaper than a higher-risk policy.

Frequently asked questions

• How much does flood insurance cost?

  The average annual cost of flood insurance through the National Flood Insurance Program is $800. FEMA fully rolled out its Risk Rating 2.0 program in April 2023, which aims to more accurately reflect individual properties’ flood risk. This means that flood insurance premiums are increasing steadily in most areas. The full risk-based average cost is $1,808 per year, and premiums are on a glide path, meaning they will increase no more than 18 percent each year until they align with the risk-based cost. Private insurers also offer flood insurance with varying rates based on factors like flood zone, home age, construction, coverage limits and deductible level.
  

• Why is flood insurance not included in a home insurance policy?

  Flooding is considered a gradual event rather than a sudden accident. This is why it is not included in a home or renter’s insurance policy. Additionally, flood damage tends to be widespread and require expensive repairs and replacements, which many home insurance companies may not be properly designed to handle.
  

• How do I protect my house from flooding?

  Some ways you may be able to protect against flood damage include:

  • Raising the house from the surface
  • Installing sump pumps and checking valves on pipes
  • Sealing cracks and gaps to prevent water from entering the house
  • Waterproofing electrical wiring
  • Directing runoff away from the house and toward the street or gutter

• Do I need flood insurance?

  Like home insurance, flood insurance is not state-mandated, but you may be required to purchase a policy if you have a mortgage and live in or near a high-risk flood zone. However, even if you own your home outright, having a flood insurance policy may help prevent the financial strain of being responsible for flood damage out of pocket. You can assess your home or building’s risk level by checking FEMA’s flood map. Before making a decision, you could consider speaking with a licensed agent to determine how necessary flood insurance is for your situation.