Flood is Not a Covered Loss
Flood losses occur all year long, but they do seem to occur more frequently at certain times of the year, e.g. Spring thaw, hurricane season, when frigid weather freeze utility services, etc. Regrettably, consumer consciousness still hasn’t seemed to catch-up to the reality that flood losses are not covered by standard homeowners and commercial insurance. Flood losses are often significant and extensive, and are worth consideration.
The language that appears in most, if not all, property policies commonly reads like this: “WHAT WE DO NOT COVER – We do not pay for loss resulting, directly or indirectly, from any of the following… flood, surface water, waves, tides….” So, if you live near the beach and ocean water damages your home, there’s no coverage. If a terrible storm sends 3 feet of surface water to fill your basement, there’s no coverage. And, if a water main breaks a block away from your home/business and the water runs off into ground floor – again, there’s no coverage. Many property owners are simply unaware of the flood/surface water exclusion. That lack of awareness though doesn’t change the coverage analysis, nor the outcome. Insurers may reasonably and correctly deny flood claims citing to this language and to concurrent causation language.
Flood coverage may be purchased separately. There is a limited flood coverage available via the FEMA/WYO programs for both building and personal property. Some property insurers will also endorse your policy with flood coverage in exchange for an increased premium, depending on how the property is rated and underwritten. In summary, advance planning and an awareness of the risk may be worth the cost of additional premium. Without a purchase of additional protection, flood is not a covered loss. (02/25/2015)