Sally Ho
Seattle (AP) – Natural disasters cycle across the US seasons and regions, but often a shocking discovery for property owners, what vast and expensive floods and floods will turn out when a massive storm destroys homes, businesses and communities.
That’s because insurance often doesn’t cover what policyholders are thinking about, or because they don’t think it should.
The unfortunate surprise is that while standard home insurance covers fire and wind damage, even good property insurance usually doesn’t cover floods and earthquakes, which require special and separate insurance for each.
Here’s what you need to know about flood insurance:
People who have flood insurance
Most people who have flood insurance should have it.
Many property owners have the option to buy flood insurance, but are mandatory for government-supported mortgages in areas that federal emergency management agencies deem the most at risk. Many banks need it even in high-risk zones.
Congress created the federal flood insurance program more than 50 years ago when many private insurers stopped offering policies in high-risk areas.
FEMA’s Flood Map Service Center offers online tools to help you see where you live. FEMA notes that even a 1% flood chance is considered high risk, as it could be a quarter of flooding over a lifetime of a 30-year mortgage.
People who do not have flood insurance
Homeowners in high-risk areas should decide not to get it. Those who pay a mortgage can drop out if they no longer need flood insurance. Or, if they buy a home or a mobile phone with cash, they may not choose it at all.
The rest of us are just rolling dice, but experts have long warned that flooding can occur almost anywhere, as flood damage does not only spike the water and penetrate the land.
Mark Friedlander, a spokesman for the industry group Insurance Information Institute, said that only about 6% of U.S. households have a flood policy, primarily in hurricane-prone coastal areas. The rate has been stable in recent years despite the increasing frequency of severe flood events, including areas where the government does not consider high risk.
“The flood shortage is the biggest insurance gap in the nation,” Friedlander said in an email. “90% of US natural disasters involve flooding, and flooding can occur in places where rain falls.”
What flood insurance covers
Even if the homeowner has flood insurance, coverage may not be sufficient to re-enter the entire policyholder.
FEMA’s National Flood Insurance Program covers up to $250,000 for single-family homes and only $100,000 in content. Renters can earn up to $100,000 on content, while commercial flood insurance covers up to $500,000.
There is concern that limiting the scope of such floods is not robust enough, especially when climate change tends to make even stronger hurricanes stronger and intensify more rainy, slower and faster.
And what commonly happens to people without flood insurance in major storms is that they can try and recover some money from standard home insurance, but they can end up in a fight to determine whether wind and rain, and even “wind rain” is harmful or even if it’s not.
Don Hornstein, an insurance law expert at the University of North Carolina, said the line between wind and water is a thin but very clear line that technical experts can determine. If there is a proverb, the law supports insurance companies.
“If a house is destroyed by floods at the same time, it’s wind at the same time (it’s not covered by private insurance,” Hornstein said.
Original issue: July 11, 2025, 1:54pm EDT
