Imagine this scenario: A severe storm hits your home, causing rainwater to soak through your roof, damaging walls and floors. To make matters worse, rising water from outside floods your basement, leaving your home in disarray. You file a claim, assuming your home insurance will cover the destruction—only to learn that your policy doesn’t cover flood damage, only water damage.
This situation is more common than many homeowners realize. Even if you rent, you could experience flood damage and your renters insurance won’t cover those damages.
Flood insurance and water damage insurance are not the same, and failing to understand the difference could leave you with costly, uncovered repairs.
What Is Considered a Flood?
The National Flood Insurance Program (NFIP) defines a flood as:
A general and temporary condition of partial or complete inundation of two or more acres of normally dry land area or two or more properties (at least one of which is the policyholder’s property) caused by:
- Overflow of inland or tidal waters
- Rapid accumulation or runoff of surface water (from heavy rain, storms, etc.)
- Mudflow
- Collapse of land along a shoreline due to erosion or waves exceeding normal levels
Key Takeaway: Flood damage typically involves external water entering your home due to natural events affecting large areas.
What Is Considered Water Damage?
Water damage, on the other hand, is usually caused by internal sources and is often covered under standard homeowners insurance policies (please check your own policy documents to see your coverage). Examples include:
- A burst pipe flooding your kitchen
- A leaking roof after a storm
- An overflowing toilet damaging floors
- A broken appliance (like a dishwasher or washing machine) leaking water
Key Takeaway: Water damage is usually sudden and accidental, originating from inside the home.
Does Homeowners Insurance Cover Water Damage?
Most standard homeowners insurance policies cover water damage if it is sudden and accidental, such as:
- Pipe bursts
- Appliance leaks
- Roof leaks (unless due to lack of maintenance)
However, insurance does not cover:
- Gradual damage (like a slow leak you ignored)
- Sewer backups (unless you have additional coverage)
- Flooding (requires separate flood insurance)
Why Immediate Action Is Crucial
Water damage can worsen quickly, leading to:
- Mold growth (a health hazard if left untreated)
- Structural weakening (rotten wood, damaged drywall)
- Electrical hazards (water near wiring)
If you experience water damage, contact a professional immediately to assess the hidden moisture behind walls or under floors. Then contact your insurance agent or the insurance company directly.
Does Renters Insurance Cover Flood Damage?
No. Standard renters insurance does not cover flood damage. Homeowners insurance doesn’t either. You must purchase a separate flood insurance policy, typically through:
- The National Flood Insurance Program (NFIP)
- Private flood insurance providers
When Do You Need Flood Insurance?
- If you live in a high-risk flood zone (mandatory for federally backed mortgages)
- If your area experiences heavy rainfall, hurricanes, or snowmelt
- Even low-risk areas can flood—about 25% of flood claims come from moderate-to-low-risk zones
What Does Flood Insurance Cover?
A flood insurance policy protects two main categories: your home’s structure and your personal belongings. Each has its own coverage limits and deductibles, so it’s important to understand what’s included—and what’s not.
What Flood Insurance Covers
- Structural Coverage (Building Property)
This protects the physical structure of your home, including:
- Foundation
- Electrical and plumbing systems
- HVAC systems (furnace, central air conditioning)
- Water heaters
- Built-in appliances (refrigerators, stoves, dishwashers)
- Permanently installed carpeting over unfinished floors
- Contents Coverage (Personal Property)
This covers your belongings inside the home, such as:
- Clothing and furniture
- Electronics (TVs, computers)
- Portable appliances (microwaves, window air conditioners)
- Washers and dryers (if not built-in)
Important Note: Flood insurance does not cover the land your home sits on.
Understanding Coverage Limits
When purchasing flood insurance, carefully review:
- Coverage limits for each category (some items may have sub-limits)
- The value of your possessions vs. the policy’s maximum payout
- Deductibles (the amount you pay out of pocket before coverage kicks in)
What Flood Insurance Does NOT Cover
Flood insurance has key exclusions, including:
- Preventable mold/mildew damage (if caused by neglect)
- Cash, precious metals, and important documents (stock certificates, deeds)
- Outdoor property (decks, fences, pools, landscaping, septic systems)
- Temporary living expenses (hotel costs if your home is uninhabitable)
- Vehicles (but comprehensive auto insurance may cover flood-damaged cars)
Talk to an agent to help make sure you’re clear about the coverage details, exclusions and limitations of your flood insurance policy to help you make the right choices for your situation.
Don’t Wait Until It’s Too Late
Most flood insurance policies have a 30-day waiting period before coverage begins. If you wait until a storm is forecasted to get a policy, it’ll be too late.
How to Protect Your Home
- Review your homeowners policy – Know what water damage is covered.
- Consider flood insurance – Even if you’re not in a high-risk zone.
- Prevent water damage – Maintain pipes, roofs, and gutters.
- Act fast after damage – Mitigate further destruction by calling professionals.
Need Help Understanding Your Coverage?
At ONYX Insurance Brokers, we help people looking for flood insurance in Blaine, Crystal, Brooklyn Park, Brooklyn Center, and the Minneapolis area in addition to the rest of Minnesota. If you’re in Wisconsin or Arizona, check us out too!
Don’t wait for disaster to strike—contact us today to review your coverage.
Being informed now can save you from financial stress later. Make sure your home is fully protected against both water and flood damage.
