Julia Taliesin is an insurance content writer at Insurify. She began her career as a journalist, covering local government and business in Somerville, Mass.
Evelyn PimplaskarEditor-in-Chief, Director of Content
10+ years in insurance and personal finance content
30+ years in media, PR, and content creation
Evelyn leads Insurify’s content team. She’s passionate about creating empowering content to help people transform their financial lives and make sound insurance-buying decisions.
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Flooding is the most common and costliest disaster in the United States, but flood insurance isn’t part of a standard homeowners insurance policy. If you want coverage for flood damage, you’ll have to buy insurance from the National Flood Insurance Program (NFIP) or a private insurer.
The government requires property owners with a federally backed mortgage in high-risk flood zones to buy flood insurance. About 40% of flood claims come from lower-risk zones, so the Federal Emergency Management Agency (FEMA) recommends everyone consider buying flood coverage.
Here’s what you should know about national and private flood insurance, how much it can cost, and how to buy coverage.
Quick Facts
Most federal flood insurance policyholders pay less than $2,000 per year for coverage.
Federal flood policies offer up to $250,000 of building coverage and $100,000 of contents coverage.
Chubb flood insurance has the highest building and contents limits.
Where to buy flood insurance
Homeowners, renters, and businesses can buy flood insurance through the NFIP or a private insurance company. If you buy a home in an area prone to flooding, your mortgage lender may require that you buy flood insurance. Be sure to speak with your lender about whether you need federal or private flood insurance.
National Flood Insurance Program
Congress created the NFIP in 1968 to reduce the socio-economic effects of floods and help homeowners, renters, and businesses recover faster after flood events.[1]
FEMA administers the program in a public-private partnership between the government, the insurance industry, and other stakeholders. Property owners can buy an NFIP insurance policy from NFIP Direct or an insurer in the NFIP’s network of more than 50 companies.
As with most insurance, your premium is based on your unique risk. The NFIP recently updated its pricing approach to set rates that better reflect a property’s flood risk.
Private flood insurance companies
The improved modeling and analysis that helped the NFIP develop its risk-based pricing approach also helped private insurers better assess risk, according to the Insurance Information Institute (Triple-I). The combination of improved modeling and NFIP price changes — which reduced premiums for some and increased premiums for higher-risk policyholders — led to a rise in the number of private flood insurance companies.
Private insurers offer much higher coverage limits and options than NFIP policies. For example, the NFIP’s homeowner building coverage limit is $250,000, while the limit on private insurer Neptune Flood’s residential property coverage is $4 million.
In 2019, federal regulators ruled that lending institutions must accept private flood policies “at least as broad as” NFIP policies.[2] Not all mortgage lenders accept all private flood insurers for mandatory coverage, so check with your lender before buying private coverage.
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How to buy flood insurance
If you’re purchasing a new home or just want to explore additional flood coverage, these are the steps you can take to buy flood insurance:
1. Assess your home’s risk level
Search your address in FEMA’s Flood Map Service Center to find its designated risk. You can also ask your insurance agent or mortgage lender if they have or can produce flood risk reports for the property or area.
2. Call an agent for an NFIP policy
Your home insurance agent will likely be able to write you an NFIP policy or can refer you to another local agent. You can also find an insurer by entering your state or territory in FEMA’s insurance provider lookup.
3. Find a private insurer
If your community doesn’t participate in the NFIP, you need to purchase additional coverage, or if an NFIP policy isn’t a good fit, check out private flood insurance. Your state may have a resource to help you find private insurers, or you can research and compare companies to find your ideal coverage.
4. Complete an application
Be sure to fill out your application accurately to ensure you get the correct quote.
5. Pay your premium
Paying on time will secure your coverage since flood insurance typically has a waiting period before going into effect. Most NFIP policies have a 30-day waiting period, with a few exceptions.[3] Waiting periods for private insurance policies range from about seven to 30 days.
The NFIP offers two kinds of coverage: building coverage and contents coverage. Building coverage protects more permanent features, like foundation walls and fuel tanks, while contents coverage insures your personal belongings. The NFIP sells building and contents coverage separately.
NFIP insurance doesn’t cover temporary housing or living expenses, financial losses, cars, or property outside the insured building.[4]
Coverage limits
The NFIP has coverage limits for each policy, so you can buy less coverage but not more than that limit. These are the coverage limits for each type of policy:
Policy Type
▲▼
Building Coverage Limit
▲▼
Contents Coverage Limit
▲▼
Homeowner
$250,000
$100,000
Business owner
$500,000
$500,000
Renter
N/A
$100,000
Though these limits may be suitable for some property owners, they won’t cover the total replacement costs for many properties. Policyholders can purchase excess flood insurance from private insurers to raise their coverage limit.
For example, if storm surge flooding destroys a $350,000 home with only $250,000 of flood coverage, the homeowner could face a shortfall of $100,000.
Even smaller things can add up: A foot of water in a 2,500-square-foot one-story home could lead to more than $72,000 in damage, according to FEMA. Multiple flood events in a year could also mean you surpass your policy limit.
Does your community participate?
Community participation in the NFIP is voluntary since participating is an agreement between municipalities and the federal government. The NFIP lets property owners buy flood insurance, and in return, communities agree to implement local floodplain management that reduces local flood risk.
You can find out if your community participates by searching the NFIP’s Community Status Book. Search for and select your state from the list, and you’ll see a list of communities that do and don’t participate. For example, 1,261 Texas communities participate in the NFIP and 135 don’t.
Important Information
Across the U.S., 2,267 communities don’t participate in the National Flood Insurance Program. In addition to not having access to NFIP coverage, non-participating communities aren’t eligible for any federal financial assistance to buy or build property in a high-risk area.
For example, you wouldn’t be able to use an FHA-secured mortgage to buy a house in a special flood hazard area in a non-participating community.
6 companies that sell private flood insurance
If you want to explore private insurance options, here’s a short list of companies that offer private flood insurance. Coverage limits vary widely among private insurers, so read up on each insurer to understand whether its coverage is right for you.
Neptune Flood Insurance: Notable for flexible excess flood coverage
Building coverage limit: $4 million
Contents coverage limit: $500,000
Founded in 2018, Neptune Flood Insurance quickly expanded coverage into every state except Alaska.[5] It offers residential, commercial, and condo association flood insurance with numerous additional coverages.
Neptune’s excess flood offerings are particularly flexible, with minimums of only $50,000 for property and $10,000 for contents coverages. Highly rated insurers and reinsurers back the company, though rating agencies haven’t officially scored Neptune’s credit or financial strength.
Chubb Flood Insurance: Notable for highest coverage limits
Building coverage limit: $15 million
Contents coverage limit: $15 million
Chubb is a national property and casualty insurance company with a strong credit rating from the agency AM Best. It has the highest overall coverage limit among private flood insurers, at $15 million for dual property and contents coverage.
It also offers competitive basement coverage limits, covering up to $30,000 for the structure, $15,000 for contents, and up to $250,000 for debris removal. Chubb writes home and auto policies in all states, but it’s unclear if its flood product is also that widely available.
Aon Edge Private Flood Insurance: Notable for high excess flood limits
Building coverage limit: $5 million
Contents coverage limit: $5 million
Aon Edge offers residential, commercial, and excess flood coverage in most or all states. It has $5 million building and contents limits for its excess flood insurance and covers structures with a replacement cost value of up to $15 million.
EZ Flood, its residential product, has a $1.25 million building limit and $875,000 contents limit. AM Best hasn’t rated Aon Edge, but the insurer claims backing by top-rated insurance companies.
Beyond Floods: Notable for pool coverage
Building coverage limit: $1.5 million
Contents coverage limit: Up to 50% of building limit
Available in 33 states, Beyond Floods only has a seven-day waiting period and offers up to $50,000 of pool clean-up and repair coverage. It offers building coverage limits of up to $1.5 million and contents coverage up to 50% of the building limit. Beyond Floods also has a high limit for loss of use coverage, at $150,000 or 50% of the building limit.
It’s a National General company, and National General is an Allstate company, so Beyond Floods has strong financial backing.
Wright Flood: Notable for automatic replacement cost value
Building coverage limit: $5 million
Contents coverage limit: $250,000
In addition to writing NFIP policies, Wright Flood offers private residential flood insurance. Its FocusFlood product is available in 19 states and includes automatic replacement cost coverage on building and personal belongings, where most insurers pay out the actual cash value. It has a seven-day waiting period, a $5 million building limit, and a $250,000 contents limit.
Wright Flood also offers excess flood insurance but doesn’t list coverage details, so you’d have to get in touch with an agent. It has excellent financial strength and credit ratings from AM Best.
Palomar: Notable for no waiting period
Building coverage limit: $5 million
Contents coverage limit: $1 million
Unless extreme weather is incoming and insurers declare a weather moratorium, you won’t have to wait at all for a Palomar policy to take effect. Palomar’s residential flood coverage has a $5 million building limit and a $1 million contents limit. Additional coverages include up to $50,000 for loss of use and $500,000 for debris removal.
Palomar offers residential policies in 30 states and has excellent credit and financial strength ratings from AM Best.
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How much does flood insurance cost?
The NFIP and private flood insurers use several factors to set premiums based on risk. Factors include building characteristics and elevation, distance from flood sources, replacement costs, insured assets, occupancy, and the likelihood of flooding in your area. The coverage limits and deductible you choose also affect your premiums.
The NFIP’s median annual risk-based premium is $1,290 in the U.S., but premiums can range as high as $13,000. In 2023, 37% of policyholders paid less than $1,000, and 32% paid between $1,000 and $2,000.
The median cost varies widely by state: Hawaii has the highest, at $3,258, with West Virginia second, at $2,683, while Utah and Maryland have among the lowest costs.
What flood insurance covers
The two main types of coverage for any flood insurer are property or building coverage and contents coverage. Building coverage insures the physical structure and permanently installed systems and appliances.
An NFIP building coverage policy protects:
Electrical and plumbing systems and solar energy equipment
Furnaces, water heaters, and fuel tanks
Refrigerators, cooking stoves, and dishwashers
Window blinds and permanently installed carpeting, cabinets, paneling, and bookcases
Foundation walls, anchorage systems, staircases, and detached garages
An NFIP contents coverage policy protects:
Personal belongings
Curtains and non-permanent carpets
Washer and dryer, portable air conditioners, and microwave oven
Valuable items (up to $2,500)
A private policy likely includes all this and more, depending on coverage type and limits.
Private insurers often offer higher limits and optional additional coverages, such as:
Temporary living expenses
Basement contents
Unattached structures
Pool repair and refill
Rental income loss
Proactive measures
Food spoilage
What flood insurance doesn’t cover
Many of the additional coverage options private insurers offer are for losses an NFIP policy doesn’t protect. NFIP building and contents policies don’t cover:
Property outside the insured building, such as landscaping, patios, fences, and pools
Financial losses from business interruption
Currency, precious metals, and stock certificates
Motor vehicles
Personal property in the basement
How insurers assess the value of your personal property can also differ. The NFIP pays out either actual cash value, what the item is worth today given wear and tear, or replacement cost, the amount it would take to buy a new item today to replace what you lost, whichever is less. Some private flood insurers offer an additional coverage option for reimbursement with replacement cost.
Good to Know
With all flood insurance, the flood’s cause matters. If flooding causes a sewer backup, your NFIP policy would cover the damage, but not if something else causes the backup. Whatever insurer or combination of coverages you choose, carefully review your policy details so you understand your coverage limits.
Is flood insurance mandatory?
Flood insurance is mandatory for some people. Federal regulations require home and business owners who have government-backed mortgages and are in high-risk flood areas to purchase flood insurance.[6] High-risk areas, defined as special flood hazard areas (SFHAs), begin with an A or V on FEMA flood maps. Homes in SFHAs have a 1 in 4 chance of flooding at least once during a 30-year mortgage, according to FEMA.
If your home or business isn’t in an SFHA, your mortgage lender may still require you to have flood insurance. Even areas with a reduced flood risk can be vulnerable. In the past 20 years, 99% of U.S. counties had a flood event, and from 2014 to 2018, 40% of all flood claims happened in low- to moderate-risk areas, according to FEMA.
Everything from melting snow and summer storms to poor drainage systems and local construction can cause floods. If you’re considering flood insurance, talk to your insurance agent and ask about relevant regional risks.
How much flood insurance should you buy?
If your lender requires you to buy flood insurance, the type of federal mortgage or a private lender’s requirements will determine how much building coverage you need. Lenders typically require you to carry building coverage limits equal to your building’s replacement cost. The dwelling coverage limit on a homeowner’s policy is a good indicator, but you can also get an official appraisal.
The NFIP’s building coverage limit is $250,000, regardless of what your lender requires. Private insurers offer much higher limits. So if your replacement cost is higher than NFIP limits, you’ll have to purchase additional private flood insurance on top of your NFIP policy, or a private policy with the right coverage limits.
To determine the right contents or personal property coverage limit, try setting up a home inventory with descriptions and prices of your belongings. The NFIP limit of $100,000 may be enough for you, but you can also purchase separate or additional coverage from a private flood insurer.
Additional coverages are typically optional but can offer significant protection in the event of serious flood damage.
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How to buy flood insurance FAQs
Whether you’re required to buy flood insurance or just considering more coverage, be sure to seek guidance from your insurer along the way. Check out this additional information about flood insurance as you research your coverage options.
Which company provides the most flood insurance?
Chubb offers $15 million of property and contents coverage, the highest among private flood insurers. Beyond Floods may have the highest basement coverage limit for you, depending on your overall property and contents limits, so it’s smart to compare plans.
Why is Neptune flood insurance so cheap?
Private insurers can manage risk by setting unique coverage limits and choosing which and how many states to cover. Neptune Flood also uses advanced risk modeling to set a “fair price” for every policy, meaning lower premiums for some policyholders.
Should you buy flood insurance if you’re not in a flood zone?
FEMA emphasizes that floods can happen anywhere and anytime, so everyone should consider buying flood insurance. Ask your insurance agent about your local risk and chat with longtime neighbors about their experiences.
What is the waiting period for flood insurance?
The waiting period for a standard NFIP policy is 30 days, with a few specific exceptions. Waiting periods for private insurance policies vary. The NFIP and most private insurers waive the waiting period if you purchase flood insurance while making a loan or mortgage transaction.
Can you get a discount on flood insurance?
You could get a discount on your NFIP policy if you’re in one of four specific map areas or your community is enrolled in the Community Rating System, which measures efforts to reduce flood risk.
Julia Taliesin is an insurance content writer at Insurify. She began her career as a journalist, covering local government and business in Somerville, Mass. She reported multiple investigative stories about municipal finances and budget allocation, building development and inspection, and personnel. When the pandemic began she became a de facto public health reporter, writing daily and weekly reports using available data to quickly communicate rates of infection and city response.
She's worked for print and digital outlets, writing everything from quick-hit breaking news to long-form community features. More recently, Julia managed content strategy at a startup creating a social platform for licensed nurses, overseeing a team of nurse freelancers and editing interview transcripts and news articles for publication.
She holds a Bachelor's degree in communications from Simmons University, with a focus in journalism. Outside of work, Julia enjoys working on crafting projects, learning about homesteading, and singing in cover bands.
Evelyn PimplaskarEditor-in-Chief, Director of Content
10+ years in insurance and personal finance content
30+ years in media, PR, and content creation
Evelyn leads Insurify’s content team. She’s passionate about creating empowering content to help people transform their financial lives and make sound insurance-buying decisions.
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