New Mexico Flood Insurance

Find the right flood insurance policy for you.

Ann Herro, Insurance Expert Written by Ann Herro
Ann Herro, Insurance Expert
Written by Ann Herro

Ann Herro has been writing about insurance and employee benefits for over 15 years. She has covered topics as easy as insuring a car, and as difficult as transparency in healthcare costs.


New Mexico has faced extreme weather since weather recording began. In fact, The Weather Channel recently named New Mexico the most extreme weather state. A quick look at FEMA's website will display the multiple disaster declarations that the state undergoes every storm season and explains the importance of flood insurance for those residing in New Mexico. A local, reliable insurance agent can help you with quotes for your next flood insurance policy.

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Recent Floods in New Mexico

  • NM estimated that flooding caused over $100 million in damage.
  • A storm caused NM $11.4 million in damage.
  • Floods cause $6 billion in damage yearly, nationwide.
  • The Midwest flooding in 1993 was the costliest river-related flood in history, costing $20 billion.
  • Floods are the number one natural disaster in the United States.

With New Mexico's dry, hot summers, torrential rains may not be absorbed into the ground and instead run into small rivers and streams, eventually overflowing them. While many New Mexico residents neglect to purchase flood insurance, the increasing number of floods is causing homeowners to reconsider.

What Is Flood Insurance?

Flood insurance covers damage that homeowners insurance policies don't. While homeowners insurance policies cover fire, lightning, and wind, they do not cover rising waters from a flood. The National Flood Insurance Program (NFIP) began in 1968 to provide flood insurance for communities that participated in the program. 

Administered by FEMA, this program co-operates with private insurance companies to help cover flood damage. FEMA sets premium based on risks like flood plain location and construction materials. Typically, you can secure up to $250,000 of coverage for dwellings and as much as $100,000 for contents. Commercial property owners may secure up to $500,000 of coverage for a building and up to $100,000 for contents.

What Does Flood Insurance Cover?

Flood insurance covers both the building and its contents. When purchasing flood insurance in New Mexico, there are two main forms of reimbursement for damage: replacement cost value (RCV) and actual cash value (ACV). RCV replaces what was lost at its value in today's market and ACV replaces what was lost at today's value minus depreciation. Insurers always reimburse for personal property losses using the ACV option. Building coverage includes these items:

  • The insured building and its foundation
  • Electrical/plumbing/air conditioning/heating systems
  • Appliances such as water heaters, refrigerators, stoves, and dishwashers
  • Flooring

Contents coverage includes these items:

  • Personal effects like clothing and electronics
  • Furniture/curtains
  • Portable air conditioners
  • Portable appliances such as microwaves
  • Flooring not already included in property coverage
  • Washers and dryers

Save on Flood Insurance

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Do You Have To Have Flood Insurance in New Mexico?

New Mexico is going through re-mapping with FEMA: FEMA is re-mapping some areas like those along the Rio Grande as special flood hazard and high-risk areas. If you live in a high-risk area and have a federally backed mortgage, the government requires you to have flood insurance. However, if you purchase a policy for your low-risk home, and then FEMA re-maps the area as a high-risk area, you may be able to continue paying the low-risk area price by a process termed "grandfathering." It is a wise idea to get quotes on flood insurance in New Mexico before these new maps take effect.

How Much Does Flood Insurance Cost?

The recent average price for a flood policy was $570; however, many factors play into this number. FEMA determines premium amounts not only by individual home characteristics, but also by their location related to flood plains. While a resident in a low-risk area may think that flood insurance isn't important, almost 25 percent of flood insurance claims come from moderate- to low-risk areas.

The NFIP offers discounts to cities and counties that complete flood abatement classes. These discounts can range from 5 percent to 25 percent. Many cities and counties in New Mexico have completed these classes. When looking at flood insurance quotes, it's important to remember that you can adjust coverage limits in New Mexico. However, always be sure that the coverage can adequately cover your building and belongings.

Getting Flood Insurance in New Mexico

When deciding to purchase flood insurance, it's important to choose a company with experience, knowledge, and service. An independent insurance agent is available to help answer questions, give coverage advice and even assist in filing a claim.

Contact an agent in your neighborhood for more information.

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