Here’s a question thousands of homeowners and renters will be asking now that the recent heavy rains are abating: Will insurance cover the water damage in my basement? Unfortunately for most the answer is “probably not.” Standard Homeowners’ insurance does not cover damage from flooding, so unless you have a specific flood insurance policy, you will have to foot the bill for any water damage from the recent rains. The Insurance Information Institute offers this rule of thumb: water that comes from from top down (ice dams, for example) is generally covered, but when water comes from the bottom up, such as in flooding, it’s not covered.
Many homeowners who live in a low-risk flood area think they do not need to insure against flooding but the reality is that in any given year, about one-third of all claims paid by the National Flood Insurance Program are for policies in low-risk communities. Over a 30-year mortgage, your home has a 26% chance of being damaged by a flood, compared to a 9% chance of fire. Water damage repair can be costly – you can learn just how costly with this inch-by-inch interactive cost of flooding calculator.
You can learn more about floods, your risk of flooding, and the National Flood Insurance Program (NFIP) at Floodsmart.gov. Don’t get caught short – talk to your agent about flood insurance options – if you are in a low to moderate risk zone, insurance can be very affordable.