California Flood Insurance

Do You Need Flood Insurance in California?

The U.S. Geologic Survey warns that the next 200-year flood in California would likely cause more than $700 billion in damage. The damage and destruction would be more devastating than even the “Big One” earthquake. Residents of California who do not have flood insurance coverage risk losing everything as a result of such an event. The last extremely destructive flood in this state was in 1862 when 45 days of heavy rains caused enough damage to bankrupt the state. The next one could be right around the corner. Make sure you protect your assets; you can start by comparing flood insurance quotes in California.

California Flood Insurance Facts as Reported by FEMA

  • As of Sept. 30, 2013, there were 252,865 flood policies in effect in CA.
  • Less than 2% of the residents of this state have flood insurance.
  • California residents filed 669 flood insurance claims between Oct. 1, 2011 and Sept. 30, 2012.
  • These claims resulted in about $9,993,000 in compensation paid to policyholders.
  • That equates to an average of about $14,950 per claim.

Why Is Flood Insurance Important in California?

California’s rainy season is from late October through the end of March, and heavy rains during this period frequently cause flooding and mudflows throughout the state.

Believe it or not, recent wildfires in this state have actually increased the risk of residential flood damage. This is because these fires have significantly altered both the landscape and the ground conditions in the affected areas. The ground in these burned areas cannot absorb water very well, so any property downstream of these areas is at risk for flooding and mudflows.

Some Californians mistakenly believe that their home or business insurance policy provides coverage against flood damage, but, with the exception of some rare cases, it does not. If you do not have a specific flood insurance policy, you will be responsible for the cost of cleanup and repair. FEMA may step in during major disasters, but the assistance they provide comes in the form of low-interest loans that you must repay to the government. This assistance is no match for the coverage afforded by a flood insurance policy.

Flood insurance provides an affordable way to get the coverage you need. Basic policies start at less than $150 a year and can provide you with peace of mind when the rainy season starts. Keep in mind that flood insurance will not go into effect until 30 days after you have purchased a policy, so do not wait until flooding is imminent to purchase a policy.

What Is the National Flood Insurance Program?

Congress created the NFIP in 1968 because homeowners were unable to get insurance coverage against floods once insurance companies stopped including it among their covered events. The NFIP created a standard flood insurance policy that homeowners throughout the United States could purchase, regardless of their flood risk.

The amount of coverage you wish to purchase and your flood risk, as indicated by FEMA-drawn flood maps, determine the rates for this federally backed flood insurance. You cannot be denied coverage if your property is in a high-risk area, nor can your rates be increased because you have filed a claim.

This flood insurance program has been vital to the financial health of many U.S. residents. In fact, between 1978 and 2013, the NFIP paid our more than $48.1 billion in flood insurance claims.

What Does Flood Insurance Cover?

Flood insurance policies, available for purchase by both individuals and business owners in California, will cover damage associated with the following:

  • Overflow of tidal or inland waters
  • Rapid accumulation or runoff of surface waters, regardless of the source
  • Mudflow, defined as a river of liquid and flowing mud carried by a current of water on the surface of normally dry land.

These policies do not cover damage from the following:

  • Landslides
  • Sinkholes or land subsidence
  • Earthquakes
  • Gradual erosion

When purchasing a policy, you can choose to buy either structural coverage, contents coverage or both. This makes coverage more affordable for those who need only one type of coverage, as is typically the case with landlords, renters and condominium owners.

  • Structural coverage: Homeowners can purchase up to $250,000 in coverage, while business owners can purchase up to $500,000 in coverage. This includes coverage for the following:
    • the building’s structure and foundation
    • any built-in appliances
    • the building’s plumbing and electrical systems
    • the building’s heating and air conditioning units (except portable units)
    • any permanently installed carpeting over unfinished floors
  • Contents coverage: Individuals can purchase up to $100,000 in contents coverage, while business owners can purchase up to $500,000 in coverage. This includes coverage for the following items:
    • furniture and décor
    • flooring or carpeting that is installed over finished floors
    • clothing, jewelry and other personal belongings
    • computers, televisions and other electronics
    • portable (window type) air conditioners
    • any portable appliances
    • merchandise, materials and inventory (if insuring a business)

Flood insurance does not provide contents coverage for property kept in basements.

Get Flood Insurance Quotes From an Agent in California

Even though the federal government backs and provides flood insurance coverage, you can only purchase a policy through a qualified retail insurance provider. Securing flood insurance quotes for your home or business is easy when you have the help of an insurance agent in the Trusted Choice® network. These independent agents are available to help you assess your coverage needs, and they can provide you with information about how much a policy will cost for different levels of coverage.

Contact a Trusted Choice agent in or near your California neighborhood to get more information so you can start reviewing flood insurance quotes.

Now, who's ready to get their insurance problems solved?