Who Needs Flood Insurance?

Flood Insurance

One thing consistently left out of basic property insurance is flood protection. If you want to protect your home from flooding, you need to buy additional flood insurance or add a rider to an existing property coverage policy, such as your homeowners (or renter’s or condo) insurance.

Flood insurance is a type of catastrophe coverage because floods are considered major events causing heavy damage. The premium is based on the property’s location and flood risk. All homes and commercial buildings are eligible for flood insurance.


Flood insurance covers property for losses from water damage due to flooding caused by heavy or prolonged rain, melting snow, coastal storm, blocked storm drainage systems, or dam failure. You can buy separate policies for the dwelling and its contents.

National Flood Insurance Program (NFIP)

The Federal Emergency Management Agency (FEMA) administers the country’s National Flood Insurance Program (NFIP). This offers flood insurance to homeowners in communities along the NFIP designated floodplains. The insurance policies are offered by private companies but regulated by the federal program.

NFIP Designated Flood Zone

FEMA keeps flood maps of the United States, separated into zones based on the likeliness of a flood occurring in each location. Low-risk homes have a one percent chance of flooding each year. Low-to-moderate flood risk areas are designated as zones B, C, and X. Inland high flood risk areas are in zone A, while coastal high-risk areas are in zone V. Areas that have not yet been determined for flood risk are marked as zone D. Visit floodsmart.gov and see the map service center to determine the flood risk to your property.


Flood insurance prices are regulated by the NFIP. You can choose replacement cost value or actual cost value. Your price will depend on your location, elevation, flood zone designation, age of the property, and the number of floors, among other things. The average annual cost of a flood insurance policy is $699.

For lower costs, you can choose a Preferred Risk Policy, which combines the building and contents coverage for buildings in low to moderate risk areas. To insure your home and its contents above the NFIP maximum, you can buy outside of the program. Buying from your homeowner’s insurer should give you an accurate and fair price.

For all of your property and casualty insurance questions, speak to Redwood Agency Group.