The federal government considers floods the nation's most common natural disasterOpens in a New Window. See note 1 Flooding strikes every state and leaves homeowners with huge repair costs. Why? Because typical home insurance doesn't cover flood damage.
To decide whether flood insurance coverage is right for you, it helps to understand the real costs and risks of flood damage. We'll walk you through some of the most important considerations.
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You've heard it before: When it rains, it pours.
But here's a little twist for you: When it rains, it also can flood – wherever you live. It's time to accept the following fact before it's too late: every home is at risk of flooding.
Even if your house is in a “low-risk” flood zone, “low-risk” does NOT mean “no-risk.”
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In fact, more than 25% of flood claims are from moderate or low-risk areas.
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That's reason enough to think about getting flood insurance or renewing your policy.
Did you know typical homeowners insurance policies don't cover floods? Here's more proof why you should consider flood insurance. In the past five years, all 50 states have experienced a flood or flash flood.
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Yet, only 27% of those with homeowners insurance said they have flood insurance.
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Still not convinced? Think about how much a flood could cost you. Just a few inches of water in your home can cost tens of thousands of dollars.
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Don't you think it's time to get flood insurance? There's typically a 30-day waiting period before the policy is effective, so you may want to sign up today.
You can't afford to wait until flooding's in the forecast.
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Do I need flood insurance?
People typically associate flooding with coastal areas prone to severe weather like tropical storms and hurricanes. They can bring torrential rain, powerful wind and storm surge.
That's not the only way it floods.
Got snow or ice during the winter? Melting spring runoff can cause water damage. Drought-prone area? Flash floods can wreak havoc in minutes. Even property development near your home can increase flood risk if natural drainage patterns are affected. Mudflows — when heavy rains create rivers of mud — are also considered a type of flooding.
That said, flood insurance is only required for homeowners who have a federally backed mortgage and live in a high-risk flood area as identified by the National Flood Insurance Program (NFIP)Opens in a New Window. See note 1
If you're not required to purchase flood insurance, you may be tempted to forgo it. But remember this rule of thumb: If it can rain, it can flood. Even if you live in a low-risk area, that does not mean that you have zero risk of a flood.
Understanding flood risk
An area's flood-risk rating is established from the Federal Emergency Management Agency (FEMA). In high-risk areas, a 1-in-4 chance of flooding exists over a 30-year mortgage. See note 2 In moderate- to low-risk zones, the chance of flooding is reduced but still present.
But 20% of the NFIP's claims come from people with property outside of high-risk areas, according to federal estimates. Get more information on risk ratings through the NFIPOpens in a New Window. See note 1
Is flood damage included in rental property insurance?
If you're a landlord, you may wonder whether you need flood coverage for your rental property or if it's included in your rental property insurance policy. Unfortunately, flooding is not typically covered by landlord insurance policies. To get coverage for flood damage, you'll need a separate policy.
There's good news for tenants with USAA Renters insurance. Flood coverage comes standard on your policy.
What does flood insurance cover?
When you purchase a flood insurance policy, you can choose from two types of coverage: building coverage and contents coverage.
- Building coverage protects the physical structure of your home, such as walls and cabinets, window blinds, electrical and plumbing systems, carpeting, and some major appliances.
- Contents coverage is for your personal belongings, including clothes, furniture, electronics and other portable items.
Make sure you understand the limitations of each type of coverage in your policy. Some items like curtains or washers and dryers may seem like they'd fall under building coverage but are actually packaged with contents coverage.
What is not covered by flood insurance?
When it comes to insurance, it can be difficult to distinguish flood damage claims from water damage claims. It's all about getting to the root of the problem.
Officially speaking, flood insurance covers direct physical losses from floods and flood-related erosion “caused by waves or currents of water exceeding anticipated cyclical levels and accompanied by a severe storm, flash flood, abnormal tide surge or a similar situation,” according to the Insurance Information InstituteOpens in a New Window. See note 1
In other words, if water flows into your basement, it makes a difference insurance-wise if that water originated from a flash flood or a busted water heater — even though the damage might look the same. The first scenario would be covered by flood insurance; the second would not.
Timing is also an important factor. Normally, flood coverage won't begin until 30 days after you purchase your policy, so don't wait until an extreme storm is approaching to act.
How much does flood insurance cost?
According to FEMA and ValuePenguin, the average flood insurance premium in the U.S. is about $700Opens in a New Window. See note 1 However, several factors can influence your premium, so you may pay more or less for flood insurance depending on:
- The flood risk rating for your areas.
- The type and amount of coverage you choose.
- The size of your deductible.
- The age and design of your home.
- The elevation of your property.
Of course, there are many ways you can reduce the cost of flood insurance, such as lowering your flood risk or choosing a higher deductible.
While flood insurance might seem expensive, the truth is that damage caused by flooding can be catastrophic.
Without coverage for flooding, homeowners are left bearing the expense of repairs and recovery themselves. And it's not cheap. According to the data from floodsmart.gov, it was reported in August 2021 that one inch of water in your home can cause upwards of $25,000 worth of damage.
Unless you're prepared to handle that kind of expense out of pocket, flood insurance is usually a smart bet.
How to get flood insurance
Purchasing flood insurance is as simple as contacting your insurance provider. USAA can help get needed flood insurance in place. You can speak with one of our representatives or review the different flood coverage options online.
USAA offers flood insurance through the NFIP and through other private insurance companies. Private flood insurance options are available through the USAA Insurance Agency and are limited to companies that offer coverage in your home's area.
The maximum coverage available through NFIP is $250,000 for a home and $100,000 for its contents. Private flood insurance options available through the USAA Insurance Agency could have even higher coverage options in your area.
Get a quote for flood insurance.
Floods can happen anywhere. Make sure you're covered.