Does home insurance cover flood?


Flood is specifically excluded from home insurance policies so if you live in a flood plain, you cannot rely on your homeowners coverage. What you can do, instead, is purchase a special flood insurance policy - such are available through the National Flood Insurance Program which is probably operating in your community.

Home Insurance Flood-Related Exclusions

Home insurance covers water damages caused by a broken pipe. However, it excludes the following hazards:

  • Water caused by the rising and the falling of tides, floods, waves, etc.
  • Underground water which seeps through a property structure.

Flooding can sometimes be caused in coastal areas by a high tide. Similarly, on the coast property loss can be caused by waves. In the case of surface waters, flooding can result from rivers breaking their banks and spilling due to torrential rainfalls.

The reason why insurance companies exclude flooding from the home insurance policies they offer, is that flooding occurs quite often, resulting in a significant number of losses in a large area, and thus, in a number of insurance claims too large for insurers to cope with.

The Remedy: Flood Insurance

Even though flood is not covered by home insurance as a cause of loss, there is a type of insurance specifically designed to provide protection to individuals living in high-risk flood zones. Through the National Flood Insurance Program (NFIP), insurance providers offer special flood insurance in floodplains in different states. The NFIP is not committed solely to selling insurance: being a federal organization, it is actively involved in taking steps towards preventing losses caused by flooding, and raising the people's awareness of the hazards involved.

Flood insurance is characterized by its affordability: for roughly $450 a year an individual can buy full flood protection for their lodgings or business buildings and the contents thereof.

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