What Is Flood Insurance?

Heartland Flood Help is not connected in any way to any insurance company. Our only purpose is to help residents prepare for floods and recover from flooding. Flood insurance is very important for flood recovery.

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What is flood insurance?

Renters or homeowners insurance usually does not help pay for damage from flooding. For protection from flood damage, you must buy flood insurance separately.

Flood insurance is an agreement between a renter or homeowner and an insurance company. Under this agreement, you agree to pay the insurance company a certain amount of money to buy the insurance for a year. This yearly amount is called the premium.

In return, the insurance company agrees to help you pay for flood damage to your home and its contents during that year. The amount of assistance the company would provide for flood damage is much higher than the premium.

You can renew flood insurance every year.

It is important to know that most flood insurance policies will not pay for hotels or temporary housing that you may need to stay in while your home is cleaned or repaired. This is true for all policies sold under the National Flood Insurance Program. Private flood insurance can provide additional coverage, including the cost of living expenses if you are displaced from your home due to a flood.

What is considered a flood?

In simple terms, a flood is an excess of water on land that is normally dry. Flood insurance typically pays for damage caused by the following events:

  • Overflow from rising rivers, streams, or other bodies of water
  • Rain so hard and so fast that water accumulates and floods more than one home
  • Sewer water pushed back into your home through your pipes as a result of flooding
  • A water main break
  • A mudslide

Flood insurance typically does not help you with water damage from:

  • A sewer system leak that is not caused by flooding
  • A burst water pipe in your home
  • Rain that enters through a wind-damaged window, door, wall, or roof

Typically, these types of damage are covered by your homeowners or renters insurance. To make sure, talk to your insurance provider.

What is the National Flood Insurance Program?

Most insurance companies stopped selling flood insurance in the late 1960s. They were worried they would lose money. That is why Congress created the National Flood Insurance Program (NFIP) in 1968. The goals of the NFIP are to:

  1. Make flood insurance available at affordable prices across the country.
  2. Encourage communities to take steps to reduce the risk of flooding.

NFIP flood insurance plans can be purchased in any community that participates in the program. To participate, a community needs to have taken certain steps to reduce flood risk. Flood insurance is available in most communities, with more than 22,000 cities and counties participating.

To see whether your community participates, select your state below.


Who sells NFIP flood insurance policies?

The government does not sell NFIP flood insurance directly. Instead, you must buy the flood insurance from a private insurance company. The insurance company also will process your claims. That means it will be the one to assess your damage from a flood. It also will be the one that sends you money you can use to pay for repairs or replacements.

The federal government, however, sets the prices for the flood insurance policies. That means those prices are the same no matter who you buy the policy from.

Most insurance companies sell the policies under what is called the Write Your Own Program. The federal government helps the insurance companies pay for their cost of writing the policies and processing claims. It also protects the companies from losing money on flood insurance.

These are the companies that sell NFIP flood insurance.

How do insurance deductibles and coverage work?

A deductible is the amount of your own money you must spend to fix flood damage before the insurance company starts to pay for the damage. Your deductible affects how much you must pay the insurance company each year for your flood insurance policy. With a higher deductible, you will pay less to buy your insurance plan, but you agree to pay more out of pocket for flood damage. With a lower deductible, you will pay more to buy your insurance plan, but you will pay less out of pocket for flood damage.

Coverage is the highest amount of money the insurance company will give you to help you pay for flood damage. This can be money to repair damage or to replace damaged property. The amount of coverage in your flood insurance plan affects how much you will have to pay each year to buy the insurance.

Here is an example about how deductibles and coverage work: You decide to buy a flood insurance plan for $104 per year. With this amount, the insurance company agrees to pay you as much as $20,000 to repair or replace your flood-damaged things. So your coverage is $20,000. This plan has a $1,000 deductible. This means that you need to spend $1,000 of your money first, before your insurance will cover the remaining repairs up to $20,000.

Flood insurance is available and important, no matter where you live. That's true even in areas identified as having moderate or low risk for flooding.

Congress created the National Flood Insurance Program (NFIP) to help make flood insurance available everywhere in the country. You can buy this flood insurance from an insurance company.

More than 20 percent of flood insurance claims in the United States are filed by people living outside of high-risk flood zones. That shows that the risk of flooding is everywhere.

Here’s the good news. You can buy lower-cost flood insurance if you live in an area that is considered to be at moderate or low risk for flooding.

What is private flood insurance?

Some insurance companies have started selling flood insurance on their own. These are policies that are not connected in any way with the National Flood Insurance Program (NFIP).

Private flood insurance is not common. But these private policies may be an option for you if your community does not take part in the federal government’s flood insurance program. You also can consider a private plan as another option, or in addition to existing flood insurance, even if an NFIP plan is available.

Read Next:

Renters’ Guide to Flood Insurance

Flood insurance is very important for renters recovering from a flood. It will help pay to replace or repair the things you own. Here is what you need to know about buying insurance that will protect you and your family.