Flood vs. Homeowners Insurance: What’s Covered

Standard homeowners insurance and flood insurance protect against very different risks. A homeowners policy typically covers fire, wind, theft, liability, and loss of use, but it excludes flood (rising water from outside your home). Flood coverage is a separate policy, often from the National Flood Insurance Program (NFIP) or a private insurer, with its own definitions, limits, and waiting periods. Understanding where each starts and stops — especially for basements, additional living expenses, and water damage exclusions — prevents costly gaps when storms hit and claims clock rules apply.

What homeowners insurance covers (and why flood is excluded)

Homeowners insurance is designed around named or open perils like fire, wind/hail, theft, vandalism, and certain accidental water damage inside the home, plus liability and Additional Living Expense (ALE) if a covered loss makes your home uninhabitable. Typical policy sections include Dwelling (Coverage A), Other Structures (B), Personal Property (C), Loss of Use/ALE (D), Personal Liability (E), and Medical Payments (F). Consumer resources from the Insurance Information Institute and state regulators summarize these benefits and common limits (for example, loss of use often starts around 20% of dwelling coverage, and personal property around 50% — check your declarations for specifics).

The critical line is the water damage exclusion. Standard forms exclude “flood, surface water, waves, tidal water, overflow of a body of water,” and often sewer/drain backup or sump overflow unless you add a specific endorsement. That is why storm surge, river overflow, and flash flooding are not covered by homeowners insurance. If your risk includes these scenarios, you need a separate flood policy.

Regulators also emphasize that flood is a separate peril. NAIC guidance lists flood insurance as its own policy, alongside optional endorsements like sewer backup and earthquake — useful when you’re mapping coverage gaps during an annual review.

Bottom line: your homeowners policy covers many major hazards and provides ALE, but it does not cover rising water from outside the home. Pairing it with flood insurance (and any needed water-backup endorsement) closes the most common water gaps.

What flood insurance covers (NFIP basics and private options)

The NFIP offers two separate coverages for residential properties: Building (up to $250,000) and Contents (up to $100,000) — you choose one or both. Building coverage includes the structure and foundation, electrical and plumbing systems, central HVAC, and permanently installed features; contents coverage includes furniture, clothing, certain appliances, and some valuables (with sublimits). Private flood policies may offer higher limits and broader features but vary by insurer.

There is typically a 30-day waiting period before an NFIP policy becomes effective, with limited exceptions (for example, certain loan-related purchases or specific post-wildfire scenarios). This waiting period is why buying flood coverage at the start of storm season is often too late.

NFIP coverage has important limitations. First, ALE is not covered — NFIP won’t pay for hotels or restaurant meals while repairs are made. Second, basement coverage is limited to specified items (e.g., washer/dryer, freezers, essential mechanicals); finishes like carpeting, drywall, built-ins, and most personal property in a basement are not covered. FEMA fact sheets and the NFIP summary brochure highlight these exclusions in plain terms.

Claim timing rules also differ. NFIP claims generally require a signed Proof of Loss within 60 days of the flood (unless FEMA extends the deadline after a major event). Knowing this clock — and documenting items before and after a loss — helps avoid payment disputes.

If you carry a mortgage from a federally regulated or backed lender and your building lies in a Special Flood Hazard Area (SFHA), federal law requires flood insurance for the life of the loan. Lender and regulator guidance explains how flood determinations, map letters (LOMA/LOMR), and detached-structure exceptions work in practice.

Water damage scenarios: which policy responds?

River overflow or storm surge enters the home. That is a flood under NFIP definitions. Homeowners insurance excludes it; you need a flood policy in force before the event and beyond any waiting period.

Wind drives rain through a damaged roof; ceiling collapses. That is typically a covered homeowners loss (subject to deductible and policy language). If rising water later floods the first floor, the flood portion would require a flood policy.

Sewer backs up into a basement during heavy rain. Homeowners policies often exclude this unless you add a water backup/overflow endorsement. NFIP generally treats backup from outside as flood only when it’s a direct result of flooding; otherwise, separate coverage may be needed. NAIC and insurer explainers call this out so owners can add the right rider.

Finished basement ruined by rising groundwater. NFIP’s basement rules cover limited mechanicals and certain appliances — but not finishes, carpeting, built-ins, or most stored personal property — so much of the loss would be uncovered even with flood insurance.

Private flood vs. NFIP: when to consider alternatives

Private flood insurers can offer higher limits, optional ALE, replacement-cost treatment for contents, and broader “water intrusion” definitions. Some states outline tiers — standard, preferred, customized, flexible, supplemental — with specific requirements like including ALE or replacement-cost contents. If your lender accepts private flood (most regulated lenders do if the policy meets federal “at least as broad as NFIP” standards), a private policy can close gaps that matter to your household.

That said, NFIP is widely available in participating communities and backed by federal claims rules. For many homes, especially where premiums are manageable and lender acceptance is straightforward, NFIP remains the baseline. Evaluate both options during renewal, paying close attention to basements, ALE, deductible pairings (building vs. contents), and waiting periods.

Checklist: choosing and coordinating your coverages

1) Confirm your flood risk. Ask your agent for your property’s current FEMA flood zone and review the need for flood insurance even outside SFHAs — many flood claims occur in lower-risk areas. If you are in an SFHA and have a federally related mortgage, flood insurance is mandatory.

2) Align limits with realistic costs. Homeowners limits should reflect replacement cost (or your chosen valuation method). For flood, set building and contents limits up to the NFIP maximums or consider private flood for higher ceilings and ALE if needed.

3) Map out water perils. Add a water-backup endorsement to homeowners if sewer/sump backup is a concern. Don’t confuse this with flood; they are separate coverages with different triggers.

4) Mind the timing rules. Buy flood coverage before storm season to clear the 30-day wait. After a loss, know the NFIP Proof of Loss deadline and any event-specific extensions.

5) Basements need special attention. Review NFIP’s limited basement items; consider how much of your below-grade space is finishings and personal property that would not be covered. Adjust expectations — or explore private flood that offers broader terms.