Flood Insurance

Flooding is not a covered peril under your homeowners or business insurance policy. You must have a separate, stand-alone flood insurance policy to be covered for flood waters damaging your home or business.

Let’s be familiar with the terminology used when discussing flood insurance.
FEMA is Federal Emergency Management Agency.
NFIP is National Flood Insurance Program.
Flood insurance underwritten by the federal government is a product of NFIP and approved by FEMA, the agency of the federal government.

According to FEMA, most homes in moderate and low-risk areas qualify for the NFIP Preferred Risk Policy. FEMA statistics show if you live in an area with low or moderate flood risk, you are 5 times more likely to experience flood than a fire in your home over the next 30 years. The average cost of a Preferred Risk Policy with fees is approximately $1.24/day.

It is important to understand the different types of flood insurance policies and what may or may not be covered under each policy. What is NOT covered is just as important as what IS covered.

NFIP flood policies are summarized as follows:

  • NFIP flood policies offer a maximum coverage of $250,000 dwelling and $100,000 contents/personal property.
  • NFIP flood policies are based on ACV-Actual Cash Value of dwelling and contents and not Replacement Cost.
  • NFIP flood policies do not offer coverage for “other structures” including pools, decks, fencing, storage buildings, etc.
  • The NFIP flood policy does not include coverage for ground erosion around or under a foundation.
  • The NFIP flood policy does not include coverage for “loss of use” or additional living expenses. If you have to relocate while your home is being repaired, there is no additional benefit through the NFIP policy to assist you with the additional expenses.
  • There is a 30-day waiting period for the NFIP flood policy to be effective if you already own the home when you obtain the policy or it is for a cash purchase closing.
  • There is no waiting period for a NFIP flood policy if the policy is written on or before the day of closing, and there is a mortgage on the home being purchased. This does not include private mortgages such as loans from family members or other related parties.

Private Flood Insurance is an alternative to NFIP Flood Insurance. Private Flood is summarized as follows:

  • Dwelling Replacement Cost coverage available up to $1million.
  • Contents or Personal Property offers an option for Replacement Cost.
  • Other Structures coverage is available with Private Flood Insurance.
  • Additional Living Expenses or “Loss of Use” coverage is available with Private Flood Insurance should you be displaced while your home is being repaired due to damage from flood waters.
  • Private Flood offers a shorter waiting period of 0-14 days depending on the insurance company.

Excess Flood is an additional flood policy that offers coverage beyond a NFIP or Private Flood insurance policies. It is coverage in excess of the NFIP or Private Flood insurance policies.

Carrying flood insurance on your home offers you peace of mind when it rains. In most cases, it costs less than a cup of coffee a day. The weather is unpredictable, so it’s important to be prepared for the unexpected. Flood Insurance is a measure of financial protection to protect your assets in the event of flooding. It is so much better than "hoping" your area is declared a federal disaster area, so you can qualify for federal disaster assistance.  In most cases, disaster assistance is a loan and must be repaid, but proceeds paid via flood insurance is yours to keep and use for repairing your home. Flood Insurance is always the better choice.

It is always a good time to talk about flood insurance! Call your trusted advisors at Fulshear Insurance to set your mind at ease and put your home or business flood insurance policy in place today. Toll free: 1.855.533.9067 or send us an email with your inquiry: Info@FulshearInsurance.com

For more information regarding floodplains, see the following floodplain mapping tools:

Fort Bend County, Texas

Harris County, Texas

Read more about flood insurance:  Myths and Misconceptions

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