Floods and Flood Insurance

Typical homeowners and many commercial policies exclude coverage for flooding, that is rising water or water flowing along the ground; they may also exclude mudflow. Home owner policies also typically exclude seepage into a house through a foundation. While theose policies exclude coverage for water coming up through sewers or drains in the basement, limited extension for this coverage might be available as a "sewer and drain backup" coverage (or something similarly titled).

Note: that the definitions of "flood" and other coverage terms depend on policy terms and conditions, as well as applicable state law. In the case of NFIP policies, Federal law applies, including regulations under FEMA's flood program, the NFIP. Seek specific advice about your circumstances from counsel, your insurance agent or a competent insurance loss professional.

Floods are typically excluded from coverage in homeowner and commercial policies. Specialty flood coverage is available from the National Flood Insurance Program (NFIP), for commercial and residential property. This coverage is not all inclusive, that is, it typically will not cover all flood exclusions in a homeowner or commercial policy.

The NFIP policies, written and authorized by the U.S. Congress, also have other unexpected terms and conditions, for example:

• dollar limits that are less than limits offered by insurance companies;
• limited coverage for certain structure elements and contents;
• extremely limited coverage in basements;
• in some locations, or for some structures, extremely limited coverage under the first elevated floor, and;
• the absence of replacement value coverage for contents.

Copies of the NFIP flood insurance policies may be reviewed online. Flood insurance is typically purchased through a local insurance agent.

If you have NFIP flood insurance, and you file a claim, that claim will be adjusted by an adjuster who is certified by the NFIP. However, unlike normal insurance, that adjuster will never have settlement authority, and only reports to the NFIP. In those atypical circumstances where a normal insurer grants flood coverage, the insurer will assign an adjuster, in a manner similar to all other claims.

Although the procedures for adjusting NFIP claims are different, many of the guidelines for filing property claims, mitigation of damages, documenting contents claims, and more, still apply. Note, however, that NFIP claims may require more documentation, and more patience, on your part.