Does Homeowners Insurance Cover a Flood?

Not only is flooding the most common and costly natural disaster in the U.S., but it's one many homeowners aren't properly prepared to handle. That's because flood damage caused by natural water, such as heavy rainfall, is not covered by standard homeowners insurance. Unfortunately, many homeowners don't actually realize this until it's too late.

To get the coverage you really need to protect your home against flood damage, work with an independent insurance agent. They'll make sure you get set up with all the coverage necessary. But first, here's a closer look at whether homeowners insurance covers flood damage.

Does Homeowners Insurance Cover Floods and Flood Damage?

Your homeowners insurance does not cover a flood or damage caused to your property by natural floodwaters. While homeowners insurance covers most other natural and man-made disasters, floods are an exception. In fact, natural flood damage is specifically excluded by home insurance, so damage from tsunamis, hurricanes, heavy rainfall, etc., won't be covered by your policy.

Insurance companies consider a flood to be any natural gathering of water. Natural flooding can result from hurricanes, storms, snowmelt, rain, cresting rivers, and even mudslides.

Fortunately, a separate policy known as flood insurance is specifically designed to cover damage from floods and natural floodwaters. If you live in a flood zone and receive federal funding for your home, including a mortgage, you're most likely required by law to have flood insurance.

Even if you don’t live in a designated high-risk flood zone, getting flood insurance is almost always a wise decision. If you don’t have it, you’ll be on the hook for the full cost of rebuilding your home and replacing your personal belongings after a flood.

If you submit a claim for natural flood damage to your home insurance company, it will be denied. That's why it's critical to ensure you have the right coverage in place before a disaster hits.

What Kinds of Water Damage Are Covered by Homeowners Insurance?

Water damage from burst pipes may be covered by your homeowners insurance, but a flooded bathroom after a thunderstorm would not be if the water came from the rainfall. You'll need to review your specific home insurance policy with your independent insurance agent to be sure, but your coverage likely includes protection for the following kinds of water damage:

Collapse from the weight of ice, snow, or sleet
Frozen and busted pipes
Accidental overflow from a household appliance or system
Water damage resulting from vandalism to the home's structure
Water damage due to ice dams on your roof or in gutters

Instances in which water damage is not covered by home insurance include:

Gradual water damage, such as water seeping into your home foundation over time
Mold and mildew caused by moisture within the home that the homeowner could've prevented
Water damage to the home due to the failure of the homeowner to maintain upkeep

Be sure to review your policy with the help of your independent insurance agent to be absolutely certain which instances of water damage are covered and excluded by your home insurance.

When and How Does Home Insurance Cover Rain Damage?

Home insurance covers rain damage only in certain instances. If someone broke into your house and damaged its structure on their way in, then later it rained, water flooded your living room, and destroyed your carpet, your home insurance would likely provide coverage.

In this instance, your home insurance could potentially pay to repair your home's structure where it got damaged, as well as to replace your ruined carpet and for repairs to other damaged personal property in your living room. Though not related to rain, your home insurance could also pay to replace any property that was stolen by the vandal up to your policy's limit.

However, home insurance won't cover rain damage if you fail to maintain the upkeep of your home, which allows the water to seep into the structure, such as if you didn't repair your roof after a prior storm. Home insurance also won't cover rain damage if the water flows into your home from underground.

Further, home insurance doesn't cover flood damage or destruction to your vehicles, nor does flood insurance. You'd need comprehensive coverage under your auto insurance for that.

How Do I Know If I Need Flood Insurance?

If you live in a flood-prone or high-risk flood area, you may already have flood insurance. Flood insurance is a legal requirement for nearly all mortgages and financing for homes in a flood zone. But if you don’t live in a flood zone, you’ll have to weigh the potential cost and risks to decide if you should buy flood insurance. Some factors to consider are:

Your location and the likelihood of a flood: Even if you’re not in a flood zone or high-risk area, your home could still be vulnerable, especially if it’s near a river or valley. Most U.S. counties are at risk of flooding at some point. On the other hand, if you’re located on higher ground, like the top of a hill, you may decide your flood risk is too low to warrant buying flood insurance.
Potential flood damage costs to your property: An expensive home or belongings means it would cost much more to repair or replace your property after a flood. Less expensive property is less risky to leave uninsured because it’s cheaper to replace. The higher your home and contents' values are, the more likely it is that flood insurance is right for you.
Your savings and ability to cover repairs out-of-pocket: If you have a low amount of debt and a high amount of savings, you may decide you’d rather save money on flood insurance premiums and take the risk of paying for any repairs yourself if a flood strikes your property. But for most people, replacing their home and belongings at a moment’s notice could be difficult or impossible. Flood insurance safeguards you against such sudden, potentially enormous costs.

If you’re still on the fence about flood insurance, an independent insurance agent can review the pros and cons of getting coverage with you. Flood insurance is often affordable for many homeowners, making it the right decision more often than not.

However, if you live in Florida, Louisiana, Texas, New Jersey, or New York, you'll almost definitely want to get flood insurance, considering more than 75% of the National Flood Insurance Program's flood damage payouts have gone to residents and businesses within these states.

How Flood Zones Work

Flood zones, technically called Special Flood Hazard Areas (SFHAs), are designated by the Federal Emergency Management Agency (FEMA). You can look up your address on the FEMA Flood Map Service Center website to see a map of flood zones in your area.

Flood zones are areas that have more than a 1% chance of flooding each year. That’s more than a one in 100 chance of flooding each year. And while a 2% flood chance may seem tiny, it’s actually quite serious, given the massive financial damage floods can cause.

Just because your home is located outside a flood zone doesn’t mean it will never experience a flood. Having flood insurance in place before a sudden and unexpected disaster occurs in your area is the best defense against what could be otherwise extremely costly flooding and resulting damage to your home and personal belongings.

How Much Does Flood Insurance Cost?

FEMA states that the current average cost of flood insurance is about $450 annually. Since flood damage to a home from just three inches of standing water can cost about $12,000 to repair, this premium may be more than worth it to many homeowners.

However, the cost of your policy will vary depending on where you live, your specific area's flood risk, the value of your home and property, and more. An independent insurance agent can help find exact quotes for coverage near you.

The Benefits of Working with an Independent Insurance Agent

When you're looking for flood protection for your home and property, an independent insurance agent can help point you in the right direction. Flood insurance is often only available from the National Flood Insurance Program, which is part of FEMA. However, a local independent insurance agent can help provide you with more information about where to find the coverage you need.

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