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What Is Flood Insurance?

Homeowners and property insurance policies do not cover flood damage.  Find out more about flood insurance and how to purchase flood coverage for your home or property.

Flood damage and flood insurance

What Does Flood Insurance Cover?


Flood insurance covers your property from water that comes up from the ground into your home or business.  

Your homeowners or business insurance does not cover flood damage. Flood insurance and coverage are always on a separate policy.


What Are Flood Zones


Flood zones determine how prone your home or business is to flood damage. The flood zone will reflect this when you are closer to a water source or if you are in an area where flooding happens more frequently.


Flood zones are geographical areas and locations that determine the risk and are used to rate the flood insurance policies. Flood zones are categorized as:

  • Flood Zones A & AE are high-risk flood zones.

  • Flood Zones B and C are moderate-risk flood zones.

  • Flood Zone X is a low-risk flood zone.

What Flood Zone Am I In?


It is essential to understand how prone your home or business is to flood damage. The easiest way to determine your policy's flood risk is to look up your flood zone. There are many different sources to find the flood zone for your property, and we frequently use


Not only does this provide the flood zone for your property, but you also have access to the different risks associated with the local area.


Additionally, at OIA, we provide the service to our clients to find out how flood-prone their property is and provide the appropriate coverage for the risk.  

Preferred Flood Rating


If your home or business property is in a low-risk area for flooding, you can be eligible for a preferred rating with the flood insurance policy. Your property must be in Flood Zone X to qualify for a preferred flood rating. The preferred rating reduces the premium on the flood policy to reflect the low risk.


What Is A Flood Insurance Map?


The flood insurance rate map is an official map of a community that FEMA has determined to be in a Special Flood Hazard area. Flood maps show the communities risk of flooding, the flood zone, floodplain boundaries, and base flood elevations of a particular location.

Flood Insurance Requirements for Lenders


Lenders and mortgage companies usually require flood insurance if your property is in a high-risk flood damage location. The lender may only require a flood policy that provides coverage for the building or property itself. However, we recommend purchasing contents coverage to cover any personal property such as furniture, TV’s & electronics, and clothing in the property

Does Flood Insurance Have To Be Escrowed?


If your bank, mortgage company, or lender requires you to maintain a flood insurance policy, they may also require the policy premium to be escrowed in your mortgage payment. For example, if the home or business property is located in a Special Designated Flood area and is required to maintain flood insurance, the lender or mortgage company will require the flood insurance premium to be escrowed. The escrow account will be set up to process the flood insurance, home insurance, and property taxes.  


To avoid lender-placed flood insurance, keep your flood insurance updated with the correct mortgage name and address to ensure the mortgage company receives the most current policy information.  

Are Flood Insurance Policies Transferable?


Yes, flood policies can be transferred to the property buyer at closing. For example, if you purchase a property in a Special Designated Flood Area, the seller can transfer the flood policy to you at closing. The benefit to transferring the flood policy is rates can be grandfathered from the prior owner's policy rather than re-rating the flood policy as new which may lead to higher rates. 

When is Flood Insurance Activated Immediately?

Under normal circumstances, flood insurance has a 30-day wait period for coverage to start after initiating the flood policy. However, if you are closing on a property or home that requires flood insurance coverage or the mortgage company needs the flood coverage to be in place at closing, the policies do not have an imposed wait limit.  


How To Get A Flood Insurance Quote


Getting a flood insurance quote and policy is easy. The Overmyer Insurance Agency can provide a flood insurance quote and start the new policy for you. We partner with Hartford Flood and the NFIP (National Flood Insurance Program) to find the best fit for property and geographic location.  


If your property is not in a specially designated high-risk flood zone (Zones A & AE) you will most likely need a flood elevation certificate that provides elevation information to determine the flood insurance premium. To obtain the flood elevation certificate, you may need to contact your town for the floodplain manager to find out if one is already on file. If the elevation certificate is not on file, you can hire a local surveyor or engineer to complete one.


If your property is in a low-risk flood zone (flood zone X), we can obtain the flood elevation information with just the address and property information to complete the quote and start your policy. No other documentation is needed.

Flood Damage Examples:


Natural disasters such as hurricanes and storms, overflowing rivers, and heavy rainstorms cause most of the flood damage covered by a flood insurance policy. However, there are other examples of flood damage that occur that are uncommon.

Some additional examples are:;


  • Improper drainage or leaves and debris cover a drain outside a residence; rainwater cannot drain into the storm sewer. As a result, water accumulates and can cause water damage to homes in the area.

  • Flash flooding occurs when there is a sudden and heavy rain event.

  • Ocean tidal forces can cause flooding in coastal regions, usually during a large storm.

How Much Is Flood Insurance?


On average, flood insurance in low-risk flood zones can be $400 - $800 annually.


The premium for high-risk flood zones can be between $2500 - $4000 a year.

Does Flood Insurance Cover Basements?


If the basement is finished and furnished, flood insurance coverage is minimal. Damage to the functionality or service to the home in the basement is covered under the flood policy, including furnaces, hot water heaters, washers and dryers, circuit breakers, sump pumps, and structural damage. UNPAINTED drywall and ceilings and foundation elements.


If you have a finished basement, the coverage is limited to the above. The flood policy does not cover the finish materials such as flooring, wall coverings, and decorative materials.

The Bottom Line:


The Overmyer Insurance Agency specializes in flood insurance, and we will review your options to ensure you have the appropriate coverage and maximize the savings on your premiums. If you would like to get a flood insurance quote or want a coverage review, we are here to help, and just a call or click away.

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