Flood insurance is vital for protecting homes and businesses, yet it’s often misunderstood. Myths about its cost, coverage, and necessity can leave property owners unprepared when disaster strikes. Let’s debunk the top 10 myths about flood insurance so you can make informed decisions and secure the protection you need.
Myth 1: Homeowners Insurance Covers Flood Damage
Fact: Standard homeowners’ insurance does NOT cover flood damage.
Many people mistakenly assume their standard home insurance policy includes flood protection. However, most policies explicitly exclude damage from floods, leaving homeowners vulnerable. A separate flood insurance policy is the only way to ensure coverage.
Myth 2: Flood Insurance Is Only Necessary in High-Risk Areas
Fact: Floods can happen anywhere—even in low-to-moderate risk zones.
While high-risk areas are more prone to flooding, 25% of flood insurance claims come from properties outside these zones. Flash floods, heavy rains, or rapid snowmelt can occur unexpectedly, making flood insurance valuable for everyone.
Myth 3: Federal Disaster Assistance Will Cover Me
Fact: Federal disaster assistance is often a loan, not free money.
Some believe government aid will replace flood insurance. In reality, federal assistance is limited and typically comes in the form of low-interest loans that must be repaid. Flood insurance offers more reliable financial protection without adding debt.
Myth 4: Flood Insurance Is Too Expensive
Fact: Flood insurance can be surprisingly affordable.
Flood insurance costs depend on factors like location and property value. For homes in low-risk areas, premiums can be less than $400 annually—a small investment compared to the cost of repairing flood damage, which can easily reach tens of thousands of dollars.
Myth 5: I Can’t Get Coverage If I’m Not in a High-Risk Area
Fact: Flood insurance is available to anyone, regardless of flood zone.
Both the NFIP and private insurers offer flood insurance for properties in all areas, not just high-risk zones. Even if you’re not required to have it, securing coverage in a low-risk area can provide peace of mind.
Myth 6: Only Homeowners Can Buy Flood Insurance
Fact: Renters and business owners can purchase flood insurance too.
Flood insurance isn’t just for homeowners. Renters can protect their personal belongings, and business owners can insure their buildings and contents. Coverage is available for anyone seeking protection from flood damage.
Myth 7: Flood Insurance Covers Everything in My Home
Fact: Flood insurance has limits and exclusions.
Flood insurance typically covers structural damage and personal property, but some items—like cash, valuable papers, and landscaping—may be excluded. Reviewing your policy carefully ensures you know what’s protected.
Myth 8: Flood Insurance Takes Effect Immediately
Fact: Most policies have a waiting period before coverage begins.
Flood insurance doesn’t kick in right away. Policies often have a 10 or 30-day waiting period, so buying coverage before a storm or flood is essential to avoid being caught unprotected.
Myth 9: Flood Damage Is Only from Rising Water
Fact: Flood damage can result from multiple sources.
Flood insurance covers more than just rising water. It can include damage from heavy rain, storm surges, overflowing rivers, and even failed dams or levees. Understanding this broader coverage ensures you’re fully prepared.
Myth 10: I Don’t Need Flood Insurance If I’ve Never Experienced a Flood
Fact: Past safety doesn’t guarantee future protection.
Just because your area hasn’t flooded before doesn’t mean it won’t in the future. Changing weather patterns and unexpected storms can bring flooding to previously unaffected areas. Flood insurance prepares you for the unpredictable.
Flood insurance is one of the most misunderstood types of coverage, but it’s also one of the most important. Clearing up these myths helps ensure your property is protected from water-related disasters, no matter where you live.
Don’t leave your home vulnerable—take the time to understand your options and secure the flood insurance coverage you need to safeguard your financial future. You can learn more about Orion180’s flood insurance by clicking here.
Contact an Orion180 agent partner today to explore your coverage options and receive a personalized quote.