‘Flood insurance is not just for coastal or high-risk areas,’ expert says: What homeowners need to know

Counties have experienced a flood event, according to the National Flood Insurance gram by the Federal Emergency Management Agency

While floods can be bigger risks in areas near bodies of water, they can happen anywhere, "even on a mountaintop," says an insurance expert

Patrick Keely | Patrick Keely Via ReutersAs Texas begins to assess the toll of catastrophic flash floods over the July Fourth weekend, experts say the devastation underscores the importance of flood insurance

And rescue efforts in affected areas continue

President Donald Trump on Sunday signed a federal disaster declaration for Kerr County, which was heavily impacted

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Owners insurance policies typically explicitly exclude floods, requiring separate flood insurance coverage. 5% of owners in Kerr County had flood coverage, according to Loretta Worters, a spokeswoman for the Insurance Information Institute

Nationwide, 3. 3% of households had a government flood insurance policy as of late 2024, according to a Value Penguin analysis

But experts say many owners would benefit from such coverage. "Flood insurance is not just for coastal or high-risk areas," Worters said. 'Every can be exposed'Texas is one of the most flood-ne areas in the U. , Worters said — flash floods, river overflows and tropical storms result in billions of dollars in insured losses per year. "Flooding in Texas has become a growing threat," she said

But it's a nationwide risk

Counties have experienced a flood event, according to the National Flood Insurance gram by the Federal Emergency Management Agency. 40% of NFIP claims are from outside high-risk zones

While floods can be bigger risks in areas near bodies of water, they can happen anywhere, "even on a mountaintop," Worters said. "Every can be exposed," she said

Less than 1% of households there were covered by the NFIP, according to a report by the Swiss Re Institute

Parts of central North Carolina also experienced flash floods over the July Fourth weekend, as Tropical Storm Chantal made its way inland. "This historic weather event caused flooding we haven't seen in several decades in the central part of the state," Joey Hopkins, North Carolina's transportation secretary, said in a press release Tuesday

Why owners insurance doesn't cover floodsInsurers tend to avoid covering risks that duce "highly correlated losses" that can be "catastrophic in nature," said Daniel Schwarcz, a law fessor at the University of Minnesota Law School who focuses on insurance law and regulation

Floods are one such disaster, as are earthquakes. "When it affects one person dramatically, it often affects many, many people dramatically," he said. 90% of all presidentially declared U

Natural disasters involve flooding, per FEMA

Watch now2:3002:30How owners can lower insurance rates as wildfires, floods drive up costsThe ExchangeResidents might have water damage coverage included in their owners policy, which can cover events such as pipe bursts, said Karl Susman, president and principal insurance agent of Susman Insurance Services, Inc

But such visions do not cover damage from rising water levels, experts say. "When you have sudden, intense flooding that's caused by heavy rain in a short period of time, that's a flash flood," Worters said. "That's something that would not be covered on your regular owners [policy]. "Where to get flood insuranceBecause standard policies often explicitly exclude flooding, if you want coverage, you'll need a standalone policy

You can get flood insurance from FEMA's NFIP, which is considered the primary source of flood coverage in the U

As of 2024, the NFIP has more than 4. 7 million flood insurance policies in force, viding coverage in excess of $1. 28 trillion, according to FEMA

If you have an expensive or expect more severe damage to your perty, consider asking an insurance agent so-called "excess flood insurance," Worters said

Such policies are written by private insurers that cover losses over and above what's covered by the NFIP, she said

If you decide to get coverage through the NFIP, keep in mind that there is usually a 30-day waiting period before the new policy goes into effect

NFIP may not be your only option

Some private insurers now offer standalone flood insurance policies as risk modeling and actuarial jections — or financial estimates for future events — have imved, said Worters

Keep in mind, however, that the price you pay for coverage will depend on factors including where you

Compare all the options available to you in your area, as they can be "drastically different" in cost, said Susman

Schwarcz said owners can sometimes get cheaper policies through private insurance companies as they use different mechanisms from the NFIP. "You want to look in both places," he said.