Standard homeowners' insurance does not cover flood damage. That is why the U.S. Congress established the National Flood Insurance Program (NFIP) in 1968. The NFIP is a federal program enabling property owners in participating communities to purchase insurance as a protection against flood losses.
The cost of flood insurance, through the NFIP, depends on several factors, such as a home's elevation, when it was built, building materials used, and how close it is to a river, lake or coast.
NFIP offers two types of coverages:
- Building Coverage: This coverage provides protection to electrical and plumbing systems, furnaces and water heaters, refrigerators, cooking stoves, permanently installed carpeting and cabinets, paneling, and bookcases, window blinds, foundation walls, anchorage systems, staircases, detached garages, fuel tanks, well water tanks and pumps, and solar energy equipment.
- Contents Coverage: This coverage provides protection for personal belongings. This includes items such as clothing, furniture, and electronic equipment, curtains, washer and dryer, portable and window air conditioners, microwave oven, and valuable items such as original artwork and furs (priced up to $2,500).