How Much Does Flood Insurance Cost?
Flood insurance will cover your home and all the items in it in case a flood causes significant water damage. This is the same way that fire insurance works. If something other than a flood does the damage, it will not be covered under the flood insurance.
If you are in a high-risk flood area, flood insurance may be mandatory. A flood insurance policy is something that is added on to your regular home insurance policy.
How much is it?
- The cost of a flood insurance policy will depend on the amount of coverage you need, your risk, the insurance company issuing the policy, what you want to protect and the size of your home. Homeowners are able to protect the building and contents, or the contents alone.
- The average annual flood insurance policy can cost anywhere from as little as $50 to as much as $2,000 or more. Since there are so many factors, it’s often hard to give an exact estimate. Refer to the table noted below for an idea on what you will more than likely pay.
- According to FloodFacts.com, the average flood policy is around $500 per year.
|Building Only||Annual Premium Estimate||Contents Only||Annual Premium Estimate|
|$35,000||$400 to $600||$10,000||$150 to $300|
|$50,000||$500 to $700||$15,000||$200 to $300|
|$75,000||$600 to $800||$20,000||$300 to $450|
|$125,000||$800 to $1,200||$40,000||$450 to $600|
|$225,000||$1,000 to $1,300||$100,000||$700 to $1,000|
NOTE: This is for a standard flood zone with a $1,000 deductible. If you want to have the building and contents covered, it is best to double the building only estimate. However, when this is done, your contents will more than likely get 30% in terms of coverage compared to the building coverage. So a $35,000 building policy would get around $10,000 in contents coverage.
What is going to be included?
- When a flood insurance policy is purchased, there is often a 30-day waiting period. If there is any damage due to a flood during this 30 day period, your home may not be covered.
- With a flood insurance policy, a deductible will apply to both the building and contents policy. The deductible will be up to the policy holder. If the building and contents were damaged, both deductibles would have to be satisfied. For example, if you have a policy for $35,000 on the home and $10,000 on contents with a $1000 deductible, you would have to pay the $1,000 on the home and $1,000 contents, and the insurance would pay the remaining balance up to the coverage amount
- A building coverage policy is going to cover the house or dwelling, a garage, permanent fixtures, furnaces, plumbing and electrical. Coverage in the basement will cover the drywall, electrical, furnaces, hot-water heater, light fixtures and help with cleanup. Content coverage will cover just about anything in the house, including clothes, furniture, decorative items, rugs, etc.
- The maximum amount of content coverage you can get $100,000.
- In order to receive an accurate quote, an insurance agent will more than likely need details on your home, a FEMA elevation certificate, any renovations that have been done in the past, and personal information.
What are the extra costs?
- Some policies may include a one-time probation surcharge, federal policy fee, and additional surcharges. This is usually less than $250.
- A home that needs to have a basement covered should add 20-30% to the policy premiums noted above. The reason for this is that in a flood, the basement will be the first thing to suffer.
Tips to know:
- Before you apply for a policy, see if your community participates in the National Flood Insurance Program. If it does not, an insurance agent will be able to write up a policy.
- The flood zone is your biggest factor that affects your quote. To find out what flood zone you are in, refer to this FEMA.gov link.
- If you purchase a home in a high-risk flood area with a federally insured mortgage, you will be required to purchase a flood insurance policy.
- A standard homeowners insurance policy will not cover floods.
- If you are purchasing a new home, order a C.L.U.E. report. This report will give you a five-year history of a home.
- Your home insurance is usually rolled into your mortgage payment each month. In most cases, the same will be done with your flood insurance. Rather than receiving another bill each month, you will just see an increase in your monthly mortgage payment.
How can I save money?
- The higher your deductible is going to be, the more you are going to save on your yearly premium. Play around with your deductibles to see what your monthly rate is going to be.
- If you already have a homeowners and car insurance policy, try to get a policy with the same company. With most companies, the more policies you have, the more you are going to be able to save.
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