Homeowner’s Insurance
FACT: Most homeowner’s insurance does not cover flood damage.
It is important to read all parts of an insurance contract, including any addendums, riders, or endorsements. These are add-on documents that provide specific rules on what is and is not covered under your policy. When you speak to an insurance agent or broker, insist that you want a copy of the ENTIRE policy, not just a statement of your coverage limit, deductible, and premium.
Many homeowners are shocked to learn that most homeowner’s insurance policies specifically exclude coverage for most or all types of damage caused by a flood.
Your mortgage lender may require you to maintain flood insurance, especially if you live in an area with a high risk of flooding, which is called a “Special Flood Hazard Area.” You should ask your lender about the requirements of your mortgage contract.
After a disaster, you should submit a claim for your damages to your home insurance company. If you apply for FEMA assistance, FEMA will require a denial letter from your insurance company.
FEMA and the National Flood Insurance Program (NFIP)
The NFIP is a federal program that assists homeowners in obtaining flood insurance. It is possible that your insurance company does not offer these policies, so the NFIP can help you find a company that does. Insurance providers who are partnered with NFIP use a standard pricing guide that is based on factors such as the risk of flooding in your area and the price of your home.
Visit www.floodsmart.gov or call 877-336-2627 to get started.
FEMA flood insurance requirements and automatic enrollment
If you have received FEMA assistance in the past, it is possible that you were automatically enrolled in a group flood insurance policy. These policies last for up to three years. Before you apply for FEMA assistance, you should check if you were enrolled and whether the policy is still active, so you can make an insurance claim.
It is also possible that, depending on your location’s flood risk, your past FEMA award came with the requirement that you purchase flood insurance to be eligible for FEMA assistance in the future.
It is important to read your entire decision letter from FEMA. It will contain information about your enrollment in flood insurance or your flood insurance requirement, if applicable.
If you have questions about whether you have been enrolled in a flood insurance policy or whether a flood insurance requirement has been placed on your property, call the FEMA helpline at 800-621-3362.
Renter’s insurance
If you rent your home, you should purchase renter’s insurance.
Most landlords will have hazard insurance on the rental property itself. This does NOT cover tenants’ personal property (clothes, furniture, electronics). This is the purpose of renter’s insurance. Renter’s insurance may also cover temporary housing if your rental property is severely damaged or destroyed.
It is important to read all parts of an insurance contract, including any addendums, riders, or endorsements. These are add-on documents that provide specific rules on what is and is not covered under your policy. When you speak to an insurance agent or broker, insist that you want a copy of the ENTIRE policy, not just a statement of your coverage limit, deductible, and premium.
Many leases require tenants to maintain renter’s insurance with a minimum coverage amount. Your landlord may have an arrangement with a company that sells renter’s insurance. You can almost always get it cheaper somewhere else. You can often bundle it with your car insurance for a good rate. Make sure your policy meets the minimum coverage required in your lease.
FEMA can provide assistance to renters, but you should first make a claim under your renter’s insurance. FEMA will require information about your policy and any claims and denials you have made during your application.