Flood Insurance

National Flood Insurance Program

Flood damage is excluded under standard homeowners and renters insurance policies. Flood coverage, however, is available in the form of a separate policy both from the National Flood Insurance Program (NFIP) and from a few private insurers.

Congress created the NFIP in 1968 in response to the rising cost of taxpayer-funded disaster relief for flood victims and the increasing amount of damage caused by floods. The NFIP makes federally backed flood insurance available in communities that agree to adopt and enforce floodplain management ordinances to reduce future flood damage. The NFIP is self-supporting for the average historical loss year. This means that unless there is a widespread disaster, operating expenses and flood insurance claims are financed through premiums collected.

The NFIP provides coverage for up to $250,000 for the structure of the home and $100,000 for personal possessions. Private flood insurance is available for those who need additional insurance protection, know as “excess coverage,” over and above the basic policy or for people whose communities do not participate in the NFIP. Some insurers have introduced special policies for high-value properties. These policies may cover homes in noncoastal areas and/or provide enhancements to traditional flood coverage. The comprehensive portion of an auto insurance policy includes flood damage.

house on liferaft

RSS Insurance Journal

  • Meatpacking Plants Linked to Up to 8% of Early U.S. COVID Cases November 27, 2020
    As many as one in 12 cases of Covid-19 in the early stage of the pandemic in the U.S. can be tied to outbreaks at meatpacking plants and subsequent spread in surrounding communities, according to a study. The findings highlight …
  • Nevada Supreme Court Rules Undocumented Injured Worker Can Get Benefits November 25, 2020
    The Nevada Supreme Court has ruled that an undocumented worker is entitled to permanent disability. The court ruled on Nov. 23 that an undocumented worker suffering trauma due to a workplace accident is entitled to permanent total disability, despite a …
  • California OKs Workers’ Comp Advisory Rates, No Virus Adjustment for Now November 25, 2020
    California Insurance Commissioner Ricardo Lara has adopted and issued a revised average advisory pure premium rate, lowering the benchmark to $1.45 per $100 of payroll for workers’ compensation insurance, effective Jan. 1, 2021. This marks the tenth consecutive reduction to …
  • Louisiana School Superintendents Seeking Looser Quarantine Rules November 25, 2020
    Leaders of several Louisiana public school systems have called on state officials to relax coronavirus quarantine rules that have sent thousands of students home from school because they have been in close proximity to someone who tested positive for COVID-19. …