Understanding Flood Insurance and How It Works

Most homeowners insurance policies don’t cover flood damage; however, it can be essential coverage, especially if your home is in an area with a high risk of flooding. Even a few inches of water can cost tens of thousands of dollars in property damage. Without flood insurance, you may have to pay for such damage out of pocket.

What Is Flood Insurance?

Flood insurance is a policy that may help cover losses stemming from specific types of water damage to your home and personal belongings. Generally, this insurance may cover incidents where water from outside your home gets in, such as during a storm surge.

How Does Flood Insurance Work?

Flood insurance is a separate policy designed to cover losses caused by flooding. Regular premiums are paid to maintain coverage after purchasing a policy and determining coverage limits. In the event of a flood, you must contact the insurance company, document the damage and file a claim with supporting documentation. An adjuster will assess the damage, and if the claim is approved, a payout will be provided based on the policy’s coverage limits and deductibles.

What Does Flood Insurance Cover?

Flood insurance typically covers two main components: building property coverage and personal property coverage.

1. Building property coverage may help cover the physical structure of your property, including the foundation, walls, electrical and plumbing systems, appliances and fixtures. It may also cover built-in items such as carpeting, cabinets and bookcases.
2. Personal property coverage may help protect your belongings and contents inside the insured property, such as furniture, electronics, clothing, appliances and valuables. However, certain high-value items, such as artwork, jewelry and collectibles, may have coverage limits. Additional coverage or separate policies may be required for complete protection.

It’s worth mentioning that flood insurance specifically covers damage caused by flooding, defined as a general and temporary condition of partial or complete inundation of normally dry land by water. It does not cover damage caused by other types of water-related events, such as sewer backups or water leaks, unless a flood directly causes them. Each flood insurance policy may have specific coverage limits, deductibles and exclusions, so reviewing the policy carefully and understanding its terms and conditions is essential.

Contact Hernandez Insurance Services today to learn more about flood insurance and take steps to protect your home.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.