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What Is Flood Insurance?

Flood insurance is a type of coverage that protects your home, belongings and financial wellbeing if floodwaters seep into your home and cause damage or destruction. Contrary to popular belief, home insurance policies don’t cover many instances of flood damage when the troubles begin with Mother Nature.

Since flooding is directly caused by hurricanes, snowstorms, heavy rainstorms and many other natural disasters, flooding is actually the most common, and one of the most costly, natural disasters on earth. It’s estimated that just 1 inch of floodwaters can cause up to $25,000 worth of damage.

Some common instances of flooding that are covered by flood insurance are overflowing rivers, lakes, ponds and other bodies of water; melting snow or heavy rainstorms that seep water into your home or its foundation; and hurricanes that drive rain seemingly sideways into your home.

What Does Flood Insurance Cover?

Structure & Foundation

☘ Your home’s physical structure and its foundation, meaning the essential pieces that make up your home, are covered by flood insurance. This can be anything from flooring and drywall to built-in cabinets and electrical wiring.

Personal Belongings

☘ Flood insurance can help pay to repair or replace your personal belongings that were damaged or destroyed directly by flooding. This coverage extends to things like TVs, computers and other electronics to furniture and clothes.

Home Appliances

☘ When floodwaters enter a home, they tend to damage or destroy a handful of appliances in your home. Luckily, flood insurance can help replace many of those appliances, like your HVAC unit, water heater, dishwasher and much more.

What’s a FEMA-Designated Flood Zone?


☘ These are areas in FEMA’s 100-year floodplain map that are most at risk of suffering a flood, usually located near bodies of water or dams.

Moderate-to-Low Risk

☘ These areas are at risk of suffering at least one flood every 100 years, making up about 20 percent of all flood insurance claims each year.

Undetermined Risk

☘ Areas of undetermined risk have either not been mapped out by FEMA’s 100-year floodplain or are at an unknown level of risk to floods.

How Does Flood Insurance Work?

Flood insurance works similarly to home or auto insurance. After flood damage has been sustained to your home, you need to document the damage, file a flood insurance claim and have a licensed adjuster take a look at the damage to process the claim.

After everything has been done, your flood insurance company may cut you a check for the damages and you will try to repair your home and restore your life as best as possible.

Do I Need Flood Insurance?

Technically speaking, flood insurance isn’t required by law, but it can be required by your mortgage lender if you’re still paying off your home. However, whether you own your home outright or not, it’s always best to have flood insurance. After all, you never know when you’ll need it. Flood insurance also takes 30 days after purchase to kick in, so it’s best to buy a policy sooner rather than later.

How Much Flood Insurance Do I Need?

When determining your flood insurance’s maximum coverage limits, you should always purchase sufficient coverage to completely rebuild your home if it were destroyed and enough coverage to replace everything you own if it was all destroyed. By purchasing enough coverage to sufficiently rebuild and replace everything, you won’t have to worry about having to come out of pocket with a substantial amount of money if a disaster were to occur.

How Much Is Flood Insurance?

The average price of flood insurance in the United States is about $600 per year, which is extremely affordable when you consider just 1 inch of floodwaters tends to cause about $25,000 worth of damage. The average cost may vary depending on which state you live in, where your property is located and which flood zone it falls within.

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