Flood Insurance

Think you don't need flood insurance because you don't live near a river, stream, lake, or pond? Think again!

Heavy rainfall, rapid snowmelt, and water collecting where it normally doesn't belong can cause flooding, even miles away from the nearest body of water.

At Barrett Insurance Agency, we have a simple way of looking at it: If it rains where you live, a flood insurance policy may make sense for you!

We've seen firsthand how devastating flooding can be throughout Vermont and New Hampshire. And just because your property isn't located in a designated high-risk flood zone doesn't mean you're free from the risk.

Your Homeowners Insurance Does NOT Cover Flooding!

This is probably the most important thing to understand about flood insurance.

Standard homeowners insurance policies exclude flood damage.

While your homeowners policy may provide coverage for certain types of water damage, flooding from rising surface water, overflowing rivers, or heavy rainfall accumulating on the ground is generally NOT covered.

The same is typically true for standard commercial property policies.

That's why flood insurance is generally purchased as a separate policy. Without it, you could be responsible for significant repair and replacement costs following a flood.

NFIP vs. Private Flood Insurance — Understanding Your Options

At Barrett Insurance Agency, we're familiar with both the National Flood Insurance Program (NFIP) and private flood insurance markets. While both can provide valuable protection, there are important differences worth understanding.

National Flood Insurance Program (NFIP)

The NFIP is a federally backed flood insurance program administered by FEMA. It provides coverage for eligible residential and commercial properties in participating communities.

However, NFIP policies have some important limitations:

• Coverage Limits: Residential building coverage is generally limited to $250,000, with up to $100,000 available for personal belongings.

• Basement Limitations: Coverage for finished basements, improvements, and belongings stored below ground level is significantly restricted.

• Additional Living Expenses: NFIP policies do not provide coverage for temporary housing or additional living expenses if a flood makes your home uninhabitable.

• Business Income: NFIP policies do not provide business interruption or lost income coverage.

• Waiting Periods: New NFIP policies generally have a 30-day waiting period before coverage begins, with certain exceptions.

These limitations are especially worth considering for homes with higher rebuilding costs, finished basements, and businesses that could experience an extended interruption following a flood.

Private Flood Insurance

Private flood insurance may offer alternatives to the NFIP, sometimes with coverage enhancements that aren't available through the federal program.

Depending on the insurance company, policy, and property, these options may include:

• Higher building and personal property coverage limits.

• Additional living expense coverage for temporary housing following a covered flood.

• Broader coverage for certain basement improvements or belongings.

• Replacement cost provisions for eligible personal property.

• Business income and extra expense coverage for qualifying commercial properties.

• Different deductibles, waiting periods, and additional coverage features.

Not every private flood policy includes these enhancements, and availability depends on underwriting and the property being insured.

Private flood insurance isn't automatically better than NFIP coverage, but it's certainly worth exploring.

Flood Insurance Isn't Just for Homeowners

Flooding can affect much more than your primary residence.

Rental properties, seasonal homes, commercial buildings, and businesses can all experience flood damage. And while a mortgage lender may require flood insurance for certain properties, that doesn't mean properties outside designated high-risk areas are without exposure.

It's also important to understand what qualifies as a flood under your policy, as not every type of water damage meets the definition.

Don't Wait Until the Water Is Rising

Flood insurance is generally something you need to arrange before a storm or flooding event.

Waiting periods can apply, and insurance companies may restrict new coverage when a significant flooding event is approaching.

The time to explore your options is when the skies are clear, not when the forecast is calling for several inches of rain.

Flood insurance is subject to eligibility, underwriting requirements, applicable flood definitions, waiting periods, policy limits, deductibles, conditions, and exclusions. Coverage enhancements and availability vary by insurer and policy.