Hurricanes & Flood Insurance: What You Need to Know

If you live in an area at risk for hurricanes, you likely understand the importance of flood insurance. But does flood insurance cover hurricane damage? Or does that fall under your homeowners insurance policy?

There’s a lot to understand about hurricanes and flood insurance. Let’s look at what’s covered, what isn’t covered, and how you can adequately protect your home and family. 

What Is Flood Insurance?

Flood insurance is insurance for homeowners who live in a community that participates in the National Flood Insurance Program (NFIP). Flood insurance is offered through the Federal Emergency Management Agency (FEMA) and issued through the NFIP. If you live in one of these communities, you can purchase flood insurance directly through your insurance broker.

There are different levels of flood insurance, but generally, a flood insurance policy provides maximum coverage of $250,000 for property and $100,000 for contents.¹ You can also purchase additional coverage through private insurers. Generally, flood insurance costs about $700 a year.²

Whether you buy flood insurance might not be entirely up to you. If you live in a high-risk flood zone, some mortgage companies and lenders will require that you purchase flood insurance. But those in high-risk areas aren’t the only homeowners who should consider this type of insurance. 

According to FEMA, almost 25% of all flood insurance claims come from areas with low-to-moderate flood risk.³ While it may not be required by your lender, you may still want to consider flood insurance if you live in a moderate- or low-risk area. Plus, those in a low- or moderate-risk zone may qualify for a Preferred Risk Policy, a lower-cost flood insurance policy. 

Does Flood Insurance Cover Hurricane Damage?

It’s important to understand what flood insurance includes because, yes, hurricane damage is covered by flood insurance, and no, it’s not covered in your homeowners policy. Therefore, it’s essential to consider all your insurance needs if you live in a low-, moderate-, or high-risk flood zone. 

However, even flood insurance policies have limitations. Some policies may exclude basement flooding, for example, in which case you would need to purchase a private flood insurance policy. It’s essential to examine what your policies do and do not cover to ensure that you’re adequately protected. 

What Insurance Options Should You Consider for Your Home?

If you live in an area at a higher risk of hurricane damage, it’s important to understand what insurance coverage you will need and what each policy will include. 

The first coverage you should get is homeowners insurance. According to U.S. News & World Report, a standard homeowners insurance policy “provides coverage to repair or replace your home and its contents in the event of damage.”⁴ This is a very general definition, but generally includes damage due to:

• Fire
• Smoke 
• Theft
• Vandalism
• Some weather events, including lightning, wind, or hail
• External forces, such as a falling tree.

Next, you should consider flood insurance, both from the NFIP and from private insurers, if needed. According to FEMA, “flood insurance is a separate policy that can cover buildings, the contents in a building, or both.”⁵ Flood insurance is available to anyone living in one of the 23,000 participating NFIP communities. 

Lastly, you should talk to your insurance broker to see if there are any other coverage options you may need, depending on the type of property and where you live. Additional policies are available for fires, floods, natural disasters, and other concerns. 

When evaluating your insurance options as a homeowner, you should consider where you live and whether there are any increased risks, such as hurricanes and flood damage. A standard homeowners policy won’t cover you in the case of flood damage, so you may also need to consider flood insurance.

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