The recent flooding along the usually tame Virgin River was an awesome display of the power and unpredictability of moving water. Several towns in Southern Utah, Nevada, and the Arizona Strip were evacuated and video footage of homes being washed away made the national news. As I watched the news footage, I could not help but think about flood insurance and hope that anyone in the affected areas had the foresight to purchase it. Homeowners insurance does NOT cover damage caused by flooding. The language will vary slightly from one policy to another, but the exclusion will read something like this:
Water damage means: flood, surface water, waves, tidal water, overflow of a body of water, or spray from any of these, whether or not driven by wind;
Water or water-borne material which backs up through sewers or drains or which overflows or is discharged from a sump, sump pump or related equipment;
Water or water-borne material below the surface of the ground, including water that exerts pressure on or seeps or leaks through a building, sidewalk driveway, foundation, swimming pool or other structure;
caused by or resulting from human or animal forces or any act of nature.
Direct loss by fire, explosion or theft resulting from water damage is covered.
An exclusion similar to this has been included in virtually every homeowner, dwelling fire, and commercial property insurance policy since the 1960’s. To clarify, the intent of this wording is to exclude damage caused specifically by flooding, surface water or sewer back-up. Water damage caused by a ruptured pipe or leaking roof is generally covered. Your policy may also have a provision for limited sewer backup coverage. The Insurance Information Institute offers this rule of thumb: water that comes from the top down (ice dams, for example) is generally covered, but when water comes from the bottom up, such as in flooding, it’s not covered. Take a moment to review the below video for additional information:
FEMA & The Flood Insurance Program
In 1968, Congress created the National Flood Insurance Program (NFIP) to help provide a means for property owners to financially protect themselves. The NFIP offers flood insurance to homeowners, renters and business owners if their community participates in the NFIP. Participating communities agree to adopt and enforce ordinances that meet or exceed FEMA requirements to reduce the risk of flooding. The National Flood Insurance Program (NFIP) is administered by the Federal Emergency Management Agency (FEMA), which works closely with nearly 90 private insurance companies to offer flood insurance to property owners and renters.
To identify a community’s flood risk, FEMA conducts a Flood Insurance Study. The study includes statistical data for river flow, storm tides, hydrologic/hydraulic analysis, and rainfall and topographic surveys. FEMA uses this data to create the flood hazard maps that outline your community’s different flood risk areas.
The FEMA maps, know as FIRM’s (flood insurance rate maps) show which areas are at particularly high risk and can expect frequent flooding, and other areas that are considered lower risk. It is important to note that FEMA considers even lower risk areas to still be in a flood zone. Statistically, 25% of all flood insurance claims come from lower risk areas.
Purchasing Flood Insurance
To get a quote for flood insurance simply call us at 888-315-7119. We will review your specific flood zone and send you a copy of the FIRM determination along with a detailed proposal and additional information about the flood insurance program. Flood insurance rates and forms are developed by the NFIP so rates and coverage are identical no matter where you buy the policy.
You might be surprised how affordable flood insurance really is. For properties in lower risk areas (such as zone X), the preferred risk policy starts at just $129 per year. For a renter looking to cover just personal belongings, the premium starts at $49 per year.
Additional information can be found online at the following links:
- Floodsmart.gov (official NFIP website)
- FEMA FAQ’s about flood insurance
- Elevation certificates (Clark County NV residents only)
- Mortgage/bank flood insurance requirements (from the OCC)