Flood Insurance in Massachusetts

On top of flash floods from usual thunderstorms, Massachusetts is vulnerable to flooding from hurricanes, tropical storms, and nor’easters. 

Homeowners insurance doesn’t cover flooding. We recommend flood insurance in Massachusetts to protect your property. Keep reading to learn how to find the best coverage.

The average cost of flood insurance in Massachusetts is $2,097 annually under the National Flood Insurance Program. Flood rates in Massachusetts are on the rise due to the NFIP’s new rating methodology called Risk Rating 2.0.

The NFIP isn’t your standard insurance company. It’s a government-run entity managed by the Federal Emergency Management Agency (FEMA). Historically, floods were too frequent and costly for private companies to insure, so the government stepped in to provide flood insurance starting in 1968.

Today, the NFIP is the largest flood insurance provider in the country and every state. It has over 20,000 active single-family flood policies in Massachusetts. 

The NFIP tries to make flood coverage relatively affordable for all. But, it changed the way it calculates its rates beginning in 2021. Unfortunately, the new methodology, called Risk Rating 2.0, raised average flood insurance rates in Massachusetts in every county.

The table below depicts Massachusetts flood insurance rates by county before and after RR 2.0.

The NFIP began enacting RR 2.0 rates for all new NFIP policies on October 1, 2021. For existing policyholders, they began phasing in the new rates on April 1, 2022, so not all policyholders are experiencing their new rate yet, which is why the current cost of flood insurance doesn’t match RR 2.0 rates yet. 

Under RR 2.0, the cheapest flood insurance in Massachusetts is in the following counties:

Unfortunately, as we stated earlier, average rates went up in every county. Over 30,000 current NFIP policyholders will see some sort of increase in the coming years. The average flood insurance rate in Massachusetts before RR 2.0 was $1,269 per year.

But, the new rating system isn’t all bad news. Over 11,000 current customers will see their premiums decrease under RR 2.0, including 5,00 people who will see their rates go down by over $1,000 annually, a significant decrease. 

And, for the people experiencing increases, the NFIP capped rate hikes at 18% per year, so you won’t have to pay your new RR 2.0 premium all at once. 

Flood insurance in Massachusetts covers flood damage to your home and belongings. Flood damage is typically brought on by storm surges, sudden coastal erosion, mudslides, and sometimes heavy rain. 

Note that flood damage is different than water damage, which can come from broken pipes or leaks and may be covered by your homeowners insurance. An easy way to remember which is which: flood damage comes from water outside your house, while water damage may come from inside your home. 

The two main components of flood insurance are building and contents coverage:

Note that NFIP policies limit their coverage of basements. Since basements are below ground, they’re very prone to damage from floodwaters entering your home. Typical flood policies won’t cover furniture and finishings in improved basements.

Although the NFIP is the largest flood insurer in the country, there are other options. The best flood insurance in Massachusetts for your situation may be available from a private flood insurance provider in the state.

The NFIP, as a government program, makes flood insurance available to everyone, even the most flood-prone properties. The government also isn’t trying to make money on the product, so it can keep rates relatively low. As a result, the program is run at a loss and has accumulated hundreds of millions in debt.

The NFIP can’t afford to cover the full value of every customer’s house. Its policies have a maximum of $250,000 in building coverage and $100,000 in contents coverage for all single-family homes. This means homes worth over $250,000 will be underinsured with NFIP coverage.

Private flood insurance in Massachusetts is an alternative to the NFIP. As technology has improved over time, private companies have been able to underwrite and offer their own flood insurance policies. They offer higher coverage limits than NFIP policies.

For instance, many private flood insurance companies in Massachusetts offer building and contents limits over $1 million if needed. They can also provide additional coverages not in NFIP policies, such as loss of use coverage.

Private policies also often have shorter waiting periods than NFIP plans. Every NFIP policy has a 30-day window from when you buy to when coverage activates, while private insurers may make you wait about half that long. This can be useful for customers trying to purchase coverage in a pinch before a hurricane or large storm.

Some private carriers may also offer improved basement coverage.

Average flood insurance rates in Massachusetts are increasing from $1,269 to $2,097 under the NFIP’s new rating system. Companies look at several factors to determine the cost of flood insurance in Massachusetts relating to your policy details, location, and home construction.

Location: before giving you flood insurance, a company will examine your location to see your home’s susceptibility to flooding. Homes closer to flooding sources (bodies of water) typically have higher premiums since they would be the first to flood if the body overflows. 

According to FEMA, counties with the highest number of properties at risk of storm surge damage in Massachusetts are:

FEMA maintains flood maps for the country and has categorized every home according to its flood risk. Homes in high-risk flood zones, called Special Flood Hazard Areas, typically have higher premiums. SFHAs are often near the coast.

Home elevation: carriers will note your home’s elevation. Houses built a) higher off the ground or b) higher above sea level tend to see lower premiums since they’re less likely to suffer flood damage. For instance, a home at the top of a hill is less likely to be reached by floodwaters than a house at the bottom of a hill.

Policy details: the specifics of your policy also influence your premiums. The higher your policy limits, the more you’ll pay. Your deductible also affects your rates. Your deductible is the dollar amount damage must exceed before your flood insurance provider steps in and covers costs. 

Choosing a higher deductible can lower your premiums because having a higher deductible lowers the chances you file a claim and the amount of money the insurer must cover. NFIP deductibles can be between $1,000 and $10,000.

Home construction: certain features of your home’s construction influence your rates. For example, masonry homes made of brick or concrete tend to withstand flooding damage better than wooden frame homes and often have lower premiums. Carriers will also look at your home’s foundation type and existing flood mitigation measures.

Flood insurance isn’t required by law in Massachusetts. But, depending on location, mortgage lenders can require flood insurance for certain homeowners.

Mortgage lenders putting money down on homes want to make sure their investment is protected, so they always require the homeowner to maintain homeowners insurance. However, home insurance doesn’t cover flood damage.

So, lenders will also require homeowners in high-risk flood zones to carry flood insurance as a loan stipulation. Banks accept NFIP and private coverage as long as it meets the home value (or reaches the NFIP limit).

By getting multiple flood insurance quotes in Massachusetts, you’ll see the coverage differences between the NFIP and private carriers, and you may save money by finding a good deal. We have several simple ways to get flood quotes from the NFIP and private companies.

We’re Clovered, an independent insurance agency built to make finding and getting insurance easier. We’re experts in all types of property insurance, and we’d be happy to help you with a flood insurance quote in Massachusetts. You can quote online or over the phone.

You can quote online with our straightforward flood insurance form. It takes minutes to fill out with some basic info about yourself and your property, and you’ll hear back from one of our licensed agents on your flood insurance options.

Feel free to give us a call, also, at 833-255-4117 during business hours. You can also email us at agent@clovered.com with any questions you might have.