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Do I Need Flood Insurance?

By August 24, 2021September 29th, 2021Flood, Home

It might sound surprising to some, but most properties across the US are at risk of flooding. Floods can happen anywhere, even to homes that are well inland. Every year, U.S. homeowners experience millions of dollars in damages related to flooding. In 2019, for instance, the National Center for Environmental Information estimated that damage costs from flooding were at least $20 billion!

While hurricanes and rainstorms are the primary sources of flooding, blocked storm drainage systems, dam failures, and melting snow can also initiate a flood. In fact, over 20 percent of flood insurance claims come from areas with low-to-moderate flooding risk.

Since homeowners insurance will not cover you for flooding, you need to purchase a separate flood insurance policy to protect your home and belongings. According to the Insurance Information Institute, there are fewer than six million policies in force. With the average flood insurance claim at around $52,000, it could be financially devastating to be without coverage.


Who needs flood insurance?

Floods are the number one natural disaster in the United States, according to the Federal Emergency Management Agency (FEMA). Yet, many homeowners pass on flood insurance coverage because they do not live in a high-risk area. However, floods are not restricted to those areas but can occur practically anywhere.

Others skip the insurance, thinking that federal disaster funds will pay for any repairs if their home is damaged. However, that aid usually comes as a low-interest loan from the Small Business Administration (SBA), meaning homeowners must pay back the loan over time.


Do I have to buy flood insurance?

That question often comes up, and the answer is that you might be required to purchase flood insurance under specific circumstances.

If your property is located in a high-risk flood area and you are applying for a mortgage from a federally regulated or insured lender, the lender must require you to have flood insurance. If the home is in a moderate-to-low-risk area, lenders will not usually force you to have the coverage. Keep in mind that a lender could require you to have flood insurance even if they are not legally mandated to do so.


Where can a homeowner get a flood insurance quote?

The National Flood Insurance Program (NFIP) and private insurers offer flood insurance policies. To purchase an NFIP or private flood policy, you will need to consult with an insurance agent, like White Cloud Insurance. You cannot buy flood insurance policies directly through the government. Many insurance companies sell through the NFIP, but numerous private insurers sell flood insurance not linked to the federal program.


How much does flood insurance cost?

According to FEMA, the average cost of flood insurance in the U.S. is $700. But premiums for a property in a low-risk flood zone could be as low as $146 up to $474 annually. You might pay more or less depending on where you live.

For example, if you buy flood insurance from a private insurer in Miami Beach, a high-risk area, you could pay as much as $18,700. The same house in a low-risk zone would carry a premium of about $3,700.

Other factors that influence flood insurance cost include:

  • The year in which the house was built
  • The number of floors in the home
  • The location of the contents
  • The deductible and coverage amounts


Is FEMA flood insurance better than private insurance?

NFIP policies have set claim limits, and the coverage might not include extras such as living expenses. The waiting period for NFIP coverage is 30 days, while with private insurance, it is typically 15 days or fewer. The advantage that NFIP policies have over the private variety is they cannot be canceled.


Shop for flood insurance at an experienced company

While it might make sense to compare flood insurance prices, consider all of the factors before deciding. For over 60 years, White Cloud Insurance has been delivering the most competitive personal insurance options. We provide specialized assistance to help you find the coverage you need to protect your home from rising waters—even if you are not in a flood zone.

Use our convenient contact form, call us at 305-556-1488, or send us a message at At White Cloud Insurance, you are always our priority.