Does Hurricane Insurance Cover Flooding?

When hurricanes approach, a common concern for many homeowners is whether their existing insurance policies will cover all potential damages. Hurricanes can unleash a variety of destructive forces, including powerful winds, heavy rainfall, and rising waters. This combination often leads to questions about whether a single insurance policy provides comprehensive protection against every type of water-related damage.

Hurricane Insurance Coverage

A standard homeowners insurance policy covers damage directly caused by a hurricane’s wind, including structural damage such as a compromised roof or broken windows. If wind creates an opening in the structure, and rain enters through that breach, the resulting interior water damage is generally covered. Additionally, damage from falling trees or debris propelled by wind is usually included in a homeowners policy.

However, a homeowners policy, even one with specific hurricane coverage, generally does not cover flood damage. This means water damage resulting from rising water from the ground, storm surge, or the overflow of inland or tidal waters is typically excluded. Some policies in hurricane-prone regions may also feature a special hurricane deductible, which is often a percentage of the home’s insured value rather than a fixed dollar amount. This percentage-based deductible can range from 1% to 10% of the dwelling’s insured value, potentially resulting in a significant out-of-pocket expense before coverage begins.

Flood Insurance Coverage

Flood insurance is a separate policy specifically designed to protect against financial losses from floodwaters. A flood, for insurance purposes, is defined as a general and temporary condition of partial or complete inundation of two or more acres of normally dry land or of two or more properties, one of which is the insured’s property. This definition includes overflow of inland or tidal waters, unusual and rapid accumulation or runoff of surface waters from any source, or mudflows.

The primary source for flood insurance in the United States is the National Flood Insurance Program (NFIP), which is managed by the Federal Emergency Management Agency (FEMA). NFIP policies provide coverage for direct physical loss caused by a flood, including the insured building and its foundation, electrical and plumbing systems, and appliances. Building property coverage through the NFIP is available up to $250,000, while personal property (contents) coverage is available up to $100,000. Private flood insurance providers also offer policies that may provide higher coverage limits or different terms than NFIP policies.

Differentiating Damage Types

Insurers distinguish between water damage covered by a standard homeowners or hurricane policy and water damage covered by a flood insurance policy. If water enters a home through a breach in the structure, such as a roof damaged by wind, this is classified as wind-driven rain damage and falls under homeowners coverage. For example, if wind tears off shingles, allowing rain to infiltrate, the resulting damage is covered by the homeowners policy.

Conversely, if water rises from the ground, a street, or a body of water and enters the home, this is considered flood damage. The origin of the water is a determining factor for which policy applies. Thorough documentation, including photographs and videos of the damage and the water’s entry point, is important for filing claims, as it helps establish the cause of loss and which policy is responsible.

Securing Flood Insurance

NFIP policies are commonly purchased through private insurance agents and companies that partner with the program. Private flood insurance can also be acquired directly from various specialized insurers. Many homeowners’ insurance providers can facilitate the purchase of an NFIP policy.

A significant aspect of flood insurance is the waiting period before coverage becomes effective. For NFIP policies, there is a 30-day waiting period from the date of application and premium payment. This period helps prevent individuals from purchasing coverage only when a flood is imminent. Exceptions to this waiting period include situations where flood insurance is required for a loan closing or when a property is newly designated into a high-risk flood area due to a map change. Private flood insurers may offer shorter waiting periods, sometimes as little as 10 to 15 days.

Flood zone maps, officially known as Flood Insurance Rate Maps (FIRMs) issued by FEMA, play a role in determining whether flood insurance is required and can influence policy premiums. Properties located in high-risk flood zones, designated as ‘A’ or ‘V’ zones on FEMA maps, are often required to carry flood insurance by federally-backed mortgage lenders.