Most standard home insurance policies don’t cover flood damage. Instead, you can purchase a separate flood insurance policy from a private insurer or the Federal Emergency Management Agency. FEMA’s National Flood Insurance Program (NFIP) covers homeowners, renters, and businesses.
Of the 22% of homeowners who reported they were at risk of a flood in a 2023 consumer survey from the Insurance Information Institute and Munich Re, 78% purchased flood insurance. Thirty-five percent purchased coverage from a private insurer, and 43% bought through the NFIP.1
Read on to learn more about flood insurance coverage and how to determine the best policy for you.
The average cost of FEMA’s NFIP flood insurance is $786 per year, but rates vary widely depending on your home’s location. Homeowners in coastal areas with a higher flood risk level, like Connecticut, pay more than average. Homeowners in landlocked states, like Utah, often pay less.
In addition to flood risk level, FEMA factors in your home’s elevation and distance from flooding sources. Flood vents or other flood-proofing features, foundation type, building replacement costs, and levee performance can also influence your rate.
Compared to other natural disasters in the U.S., flooding is the most common and causes the most expensive damage. Your mortgage lender may require you to carry a flood insurance policy if you live in a high-risk area, even if it’s not legally required.
Flood rates vary based on your area’s risk level and local repair costs. Washington, D.C., residents pay the least for flood coverage, at an average of $395 annually. Connecticut has the highest average annual rate, at $1,174.
The average cost of risk-based flood insurance is $1,290 per year. But FEMA limits yearly premium increases and offers discounts for some policyholders and communities, so you’ll likely see a lower rate.5
Here’s the average annual cost of flood insurance in every state.
The NFIP’s Risk Rating 2.0 went into effect in 2021. Under the new rating, flood insurance premiums depend more on risk levels for individual properties than on general categories by location and property type. But flood-prone areas with a high concentration of policies generally have more filed claims, which still increases rates in those states.
FEMA breaks down perils into five types of flood risk: inland flooding, storm surges, tsunamis, Great Lakes losses, and coastal erosion.6
Inland flooding is a risk, no matter your location. If a state has a specific flood risk in addition to inland flooding, that factor is in the table below. Here are the states with the most expensive NFIP flood insurance.
People living in states with fewer flood risks typically pay less for coverage. Washington, D.C., residents pay the least for flood insurance, with an average annual rate of $395. A higher percentage of D.C. residents living in apartments above ground level may also reduce the chances of flood damage in the city.
Here are the cheapest places to buy NFIP flood insurance.
Flood insurance offers financial protection from unexpected expenses. A single inch of pooled water in a 1,000-square-foot home can cause approximately $11,000 worth of damage, according to FEMA. NFIP flood insurance policies cover water damage to buildings and personal property.
Flood insurance can cover the following:7
Building foundations
Detached garages
Electrical and plumbing systems
Carpeting
Central air conditioning, furnaces, and water heaters
Appliances, including refrigerators, stoves, washers, dryers, and dishwashers
Food freezers and spoiled food in them
Window blinds
Personal belongings, such as clothing, furniture, artwork, and electronics
Permanently installed paneling, bookcases, cabinets, and wallboard
Debris removal
So if your basement flooded, an NFIP policy would pay to replace a damaged water heater or personal property you kept in storage. The NFIP would also cover replacement carpeting.
NFIP policies don’t cover all flood-related damages. For example, NFIP coverage won’t pay for remediation if a flood results in mold or mildew that you could’ve prevented. It also won’t cover water damage that didn’t result from flooding, such as a sewer backup.
The federally backed flood insurance won’t cover the following:
Moisture, mildew, or mold damage that the property owner could’ve avoided
Currency, precious metals, or valuable papers
Property outside the insured building, like pools, patios, fences, or decks
Temporary living expenses
Financial losses caused by business interruption
Car damages
The NFIP isn’t your only option. Private insurance companies offer flood insurance policies, too. If you want more policy flexibility or higher coverage limits, it’s worth looking into buying coverage directly from a private insurer.
Private companies can offer higher dwelling coverage limits. NFIP policies max out at $250,000, but private insurers offer limits of up to $500,000 or more depending on your flood risk. NFIP policies cover personal property up to $100,000, but private insurers can pay for up to $250,000.
After you purchase your policy, the NFIP has a 30-day waiting period before your coverage is active. Some private insurers offer shorter wait times if you need coverage as soon as possible.
Numerous private companies provide flood insurance coverage. If you need higher coverage limits with a shorter waiting period or just want to compare rates on the private market, consider these insurance companies:
Neptune Flood: Provides up to $4 million in dwelling coverage and $500,000 in contents coverage and pays for some claims the NFIP won’t cover, including temporary living expenses and pool repair.
Aon Edge: Sells residential policies to fulfill mandatory purchase requirements, as well as excess flood insurance that provides up to $5 million of combined building and contents coverage.
The Flood Insurance Agency’s Private Market Flood: Offers multi-year policies and additional supplemental loss payment through FloodFLEX. The FloodReady endorsement pays for repairs with FEMA-approved flood damage-resistant materials, even if the cost exceeds the value of the original damaged materials.
Acrisure: Partners with private flood insurance companies to match you to insurers that offer personalized coverage solutions.
Purchasing flood insurance can offer financial protection from unexpected events. Plus, your mortgage lender might require it, especially if you live in a high-risk flood zone.
Take the following steps to purchase coverage through the NFIP:
Determine if your county participates by checking FEMA’s NFIP database.
Find an NFIP partner insurance provider in your state.
Select and purchase your coverage.
Wait 30 days for your policy to go into effect.
Alternatively, you could research private flood insurance companies, get quotes from a few agents, and select the coverage that best fits your needs.
The NFIP and private insurers determine flood insurance rates using a number of factors, including:
You have a few ways to try to reduce your premium and save money on flood insurance. Installing flood openings, or floor vents, can prevent water from building up under your foundation, reducing your home’s flood risk. You can also fill in your basement to reduce your premium — especially in high-risk zones.
Elevating your property (including adding a new upper story) can reduce your premium, as can raising your HVAC, electric panel, and water heater off the ground. If you can’t take steps to flood-proof your property, increasing your deductible is another way to lower your rate.
The following information should help answer your remaining questions about the cost of flood insurance.
No. Your flood insurance typically isn’t tax-deductible unless you use a portion or all of your home for business.
On average, a National Flood Insurance Program policy costs $786 annually. Your rates may be higher or lower depending on the type of house you own, what flood zone you live in, and more.
No. Renters insurance doesn’t cover flood damage.
You should consider buying flood insurance if you live in an area at risk of flooding. Legally, you may need to purchase a flood insurance policy if you have a federally backed loan or live in a high-risk flood zone. If you have a mortgage, your lender may also require you to purchase flood insurance.
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