Flood Insurance

Understanding Flood Insurance


Good flood insurance is designed to financially protect property owners from water that damages both covered structures and/or the belongings of the property owner. This insurance coverage can be purchased from a several insurance agencies but is under government regulation. Typically this results in a pretty uniform cost for similar policies regardless of where it is acquired.
The National Flood Insurance Program (NFIP) was created to provide coverage to those who live in designated flood zones and is operated by The Federal Emergency Management Agency (FEMA). Note that there are insurance providers who also provide additional coverage beyond this basic protection to help fill the gaps.

Types of Coverage

Policies are made available for homes and business properties. Homes that are financed by government-sponsored lenders are mandated to obtain this coverage in the aforementioned special flood zones. Renters can also obtain coverage for their personal property as well.
There are essentially three types of coverage offered:

Replacement Cost

This protection compensates one for the expense of replacing a damaged home.

Personal Property

This coverage protects the items that one has inside his or her homes. Items protected can include furniture, appliances, wardrobe, fixtures and more.

Building Protection

This protects the actual structure of a commercial property or home. This protects the foundation, walls, attached staircases, etc.


Insurance for floods can save huge out-of-pocket costs on the remodeling or rebuilding of structures. If water damages personal possessions, they are also covered. It can provide great peace of mind as well in knowing one is protected.