Some insurers sell home insurance policies that cover flood damage, but most home insurance policies exclude flooding. many exclude flooding and other types of water damage. If you want your property insured against flood damage, you must purchase a policy in addition to your homeowners insurance. Your options are to buy it through the National Flood Insurance Program (“NFIP”) or an insurance company that sells it as a “stand-alone” policy.
Flood insurance is available through the NFIP to anyone who lives in a community that meets federal stormwater and floodplain management standards. Condo and home owners can purchase NFIP insurance for their structures and contents. Renters can purchase NFIP flood insurance for their contents. you can review the nfip rules here.
Reading: How does flood insurance payout
about the nfip
The NFIP program was created by the United States. congress in 1968. prior to that time, flooding was covered by a standard homeowners policy, but private insurers panicked about flooding along the mississippi river and pulled out, so the federal government stepped in and created a flood insurance company. the nfip is governed by the united states. Congress and administered by the Federal Emergency Management Agency (“FEMA”). Congress approves policy language, claim rules, and pricing for NFIP policies. 
Although the NFIP is a public entity, “regular” (private) insurance companies, including Allstate and State Farm, play an important role in the program. Their sales representatives sell NFIP policies and play a role in adjusting flood claims. Some insurance companies sell supplemental flood coverage through policies and riders (add-ons) labeled “excess” or “surplus” or “difference in condition.” if you have one of these attachments, read the text and then read it again. such as home policies that cover flood damage, are rare.
Frequently asked questions about flood policies and claims:
1. Does my homeowners, renters, or business policy cover flood or water damage?
You are most likely reading this because your property has been damaged by water that can be considered a flood. If so, we hope you have an NFIP policy because your home insurance probably excludes flood damage.
if you don’t have nfip flood coverage but your home was damaged by water, there may be coverage under your homeowners policy if and only if:
- Your property was damaged by wind-driven rain or rain that entered through a hole (“intrusion” – in legal jargon).
- the damage was not caused by a “flood” as that term is defined in your policy
- The wording of your policy exclusions for flood damage and/or concurrent causes is vague or unclear.
- has an expensive or “surplus lines” policy that doesn’t exclude flood damage.
- Keep a journal of conversations and events related to the damage and your claim
- cooperate and be as courteous as possible with the nfip adjuster, allow them to inspect the damage and remains of the property
- provide documentation of your loss/all damages
- Get independent estimates to repair the damage and restore your home to a safe and habitable condition
- If the adjuster tells you that the damages are not covered and what they say does not make sense to you, consult a professional expert with experience in flood claims and file a written complaint with your representatives in Congress and the Senate .
- revised nfip flood insurance claims handbook (August 2014)
- your guide to handling flood insurance claims, by samuel bearman and dennis abbott.
2. How do I know if I have an NFIP policy?
If you can’t find anything that looks like an nfip policy or declarations page, check with your homeowners insurer, agent, broker, or nfip. If your NFIP policy was issued through a private “write your own” insurance company, it may have that company’s name on it, but it is actually an NFIP policy.
If you have a federally backed mortgage and were required to purchase flood insurance, you must have coverage. the premiums have most likely been deducted from your foreclosure account. If your flood coverage was terminated at some point but you were never notified of the termination, you may have some recourse from whoever dropped the ball by notifying you.
3. a flood has occurred and I have flood insurance. What does my policy cover?
Up to $250,000 of coverage for a home (including a garage) damaged by flooding. includes cleaning and repairs, exterior and interior walls, debris removal, and remediation of resulting mold, mildew, and fungus. with some exceptions, building code/icc “incremental costs of compliance” are also covered. if you paid for contents coverage, you have up to $100,000 in benefits under a residential policy and $500,000 for commercial policies. benefits for certain items are capped or limited. some examples are works of art, jewelry, collections and antiques.
Just like with a homeowners policy, start with the declarations page of your flood policy to find out how much and what kind of coverage you have. there are three basic nfip forms, but you can add various options to them.
NFIP flood policies also cover damage from “mudflows,” which means liquefied earth, not landslides. think “chocolate milkshake, not chocolate cake”. For more information on flood and mudflow insurance, visit www.floodsmart.gov. commercial flood policies typically include coverage for business interruption/loss of income in addition to property damage.
4. my flood policy has the name/brand of an insurer. Am I insured through them or nfip?
the nfip. In 1983, FEMA created the Write Your Own (WYO) program, which allows private insurance companies to sell the standard NFIP/FEMA flood policy under their own brand/name, but it is still an NFIP policy. Through the WYO program, FEMA sells flood policies more widely and delegates administration of the policies to private insurers. Private insurers are paid an expense allowance for processing claims and selling policies. fema is responsible for paying claims. The current NFIP structure is generally a great deal for private insurers. earn rewards/benefits without taking the risk of paying claims. And while the Wyo insurer may be involved in adjusting your claim, the responsibility stops at the NFIP, which can lead to confusion and delays.
5. What doesn’t my flood policy cover?
damages that exceed the limits of the policy or that are clearly excluded in a clear and unambiguous wording of the policy. Many homeowners policies have special wording that gives you additional homeowners coverage under certain conditions. this wording will be found in an “extended replacement” or “guaranteed replacement” clause. NFIP policies do not have this wording. your limits will be exactly as stated on the declaration page. basements, terraces, swimming pools, walkways, trees, bushes are not covered. A basement is defined as any area of a building, including any sunken room or portion of a room that has its floor below ground level on all sides.
6. Does a flood policy cover additional living expenses while my home is uninhabitable?
not. Expenses such as temporary rent and other costs you incur due to loss of use of your home are not covered by NFIP policies.
7. How is the flood insurance claim process different from a home insurance claim?
Just like with a housing claim, you’ll need to educate yourself and advocate for a quick and fair settlement and get help if you hit a wall. But there are big differences between housing and flood claims.
If you purchased your flood policy directly from the NFIP, only a “certified” flood claims adjuster can handle the inspection and settlement with you. Most certified flood adjusters spend most of their time on the road working for hire through large “independent” adjusting firms like Pilot and Crawford. After large-scale flood disasters in the past, there has been a shortage of these adjusters and claimants are experiencing frustrating delays. If you purchased your flood policy from a Wyoming company, you will work with one of their personal adjusters or an “independent” rent adjuster. As with all adjusters, you may get lucky with one who is experienced and personable, or you may end up with one who is new to the job or an adversary from the start.
There are short, firm deadlines for filing nfip claim paperwork and fewer benefit categories than you’ll find in a home policy. Policy language is standardized and written into federal law, so there is very little “wiggle room” or room for different interpretations. Most homeowners policies cover the cost of temporary housing, “other structures,” trees, shrubs, and gardens and swimming pools. an nfip policy does not.
8. What is the first step for an insured when filing a claim under a flood insurance policy?
You must submit a written “Notice of Loss” to the NFIP as soon as possible after a loss. if you have an insurance agent, they can file for you.
After that, you must complete, sign and return a proof of loss form within 60 days. (Form 086-0-9) Sixty days is a very short period of time to account for and value everything that needs to be repaired or replaced after a flood, but that period is mandatory. if you screw it up, your claim will be denied. And, unlike most home claims, the NFIP will not accept a form that says “undetermined” as the amount of loss, with the understanding that the actual amount will be provided later.
fema often extends the deadline for filing proof of loss after a disaster. extensions are usually issued in the form of a memorandum from the federal insurance administrator. check the nfip website to find out if the deadline for your claim has been extended. www.floodsmart.gov. If you can’t confirm that the deadline has been extended, make sure you follow the 60-day rule.
Here is a short list of “things to do” if your home has been damaged by flood waters.
9. What should I do after my claim has been filed?
Take plenty of photos of the damage and before you remove any damaged or destroyed items from the home or begin any drying or repairs. If the NFIP tells you there will be a delay in getting an adjuster to inspect, dry your house out as best you can and hire a reputable, qualified local company that specializes in water damage repairs.
“I have a two story house. I was told by the flood adjuster that the main level is considered a basement so it is not covered. I read the policy carefully, inspected my home and foundation, defended myself, called my local TV station to complain, and gave the adjuster the technical arguments that won the day.” s.i., long island, new york
10. when must my “proof of loss” be submitted?
Written “Proof of Loss” (document you sign confirming/certifying your loss/claim) must be submitted within sixty (60) days of the loss. Most lawsuits involving flood claims are related to the policy issue and failure to file on time.
The pol may be waived for claims under $7,500, but you must obtain the express written consent of your adjuster or their superiors at FEMA for any waiver of the proof of loss requirement. As with the notice of loss, you must use a standard form issued by FEMA. the proof of loss form is available online at: www.fema.gov/library/viewrecord.do?id=2545 the form must be filled out completely or it will be rejected. for example, a proof of loss is considered insufficient if it does not provide the amount of money claimed by the insured. Also note that supplemental proof of loss may not be legally permitted under the flood policy.
According to a September 17, 2014 letter from fema to up: “fema recognizes that, in limited circumstances, a policyholder may need additional time to prepare and submit their claim to their nfip insurer. In such cases, the policyholder may request the insurer to seek an individual exemption from FEMA’s proof of time-loss requirement. This request is made through the insurer once the claim has been submitted to the insurer and is ready for payment. fema generally responds to such requests within 10 days, unless more information is required. each request is handled on a case-by-case basis and if the delay has not prejudiced the [nfip] and the policyholder’s efforts have been in good faith, requests are generally approved.”
11. What else should I do to ensure my full recovery from a flood?
A flooded home is susceptible to mold, mildew, and fungus that can grow in hidden areas. Mold can be extremely dangerous to breathe and will damage your home, so all mold must be removed quickly and efficiently. Mold damage is evaluated on a case-by-case basis, and pre-existing mold problems will not be covered by your NFIP policy. however, your policy covers “reasonable measures” taken to mitigate mold and/or mildew.
12. What are the losses payable under a standard flood insurance policy?
The replacement cost value of flood damage to a primary residence will be paid at the replacement cost value as defined by the policy. flood losses on dwellings other than the primary residence are paid at actual cash value. actual cash value is always paid for content. Be sure to review your policy carefully because the timing and amount of payments can be affected by certain variables.
13. what is the time requirement to file a lawsuit to contest the denial or underpayments or underpayments?
A lawsuit must be filed in federal court within one year from the mailing date of the notice of disavowal or partial disavowal you receive from the nfip or wyo company. Be sure to hire an attorney who has experience litigating flood insurance disputes. There are many specific rules and procedures related to NFIP claim disputes and your attorney should be aware of them. Federal courts have exclusive jurisdiction over claims arising under a flood insurance policy, and any lawsuit brought in state court does not interrupt the one-year statute of limitations.
14. Can I appeal an NFIP claim decision that I don’t think is fair?
yes. you can and you should. Information on how to appeal an NFIP claim decision can be found in the fact sheet “Appealing Your Flood Insurance Claim” at www.floodsmart.gov. If your claim has not been “denied” but the flood adjuster is underestimating the cost of repairs, you can request an appraisal. Read about the appraisal process in the up claim help library.
15. What are my options for recovery help if I don’t have any flood insurance?
You may be eligible for a $33,500 fema grant or sba loan if the flooding is declared a federal disaster. however, most of the time, flooding is too localized to be declared a federal disaster.
Considering the impossibility of recovering your entire losses through federal disaster assistance, it’s definitely worth insuring early. You can purchase a relatively inexpensive NFIP preferred risk policy if your home is located outside of a high-risk flood area. For as little as $180/year, you can get a minimum of $50,000 of residential construction coverage and $15,000 of contents coverage, and you have the option to purchase the same higher limits as a standard NFIP policy: $250,000 of construction coverage and $60,000 of coverage. of content.
special thanks to florida attorneys kelly kubiak of merlin law group, samuel bearman with bearman law and dennis abbott with consulting services in disasters and amy bach for their contribution to this publication.