A typical home insurance policy in California won’t cover water damage caused by outside flooding, so Golden State residents in high-risk areas should consider purchasing flood insurance to protect their home and personal belongings from flood damage. Though not required by law in California, your mortgage lender may require this coverage if you live in a high-risk flood zone according to Federal Emergency Management Agency (FEMA) maps.
Just 4% of California homes are located in a high-risk flood zone, or an area where homes have at least a 25% chance of being flooded over the next 30 years, according to FEMA. [1]
While this would appear to be good news for Golden State residents, FEMA maps may greatly underestimate the state’s actual flood risk. In fact, the percentage of homes at high risk of flooding may actually be double that of FEMA’s projections, according to First Street Foundation. [2]
What does flood insurance cover in California?
Flood insurance helps cover the cost of flood damage to your home and belongings. That means if your house is damaged due to coastal flooding, a river overflow, or rapid snowmelt from the Sierra Nevada, flood insurance can pay to repair or replace your property.
A standard flood insurance policy through the NFIP comes with two main coverages that can be purchased together or individually.
Building property coverage: Pays to repair or rebuild your house or garage if they’re damaged in a flood. The maximum building property coverage limit with the NFIP is $250,000, meaning that’s the most the NFIP will reimburse you for repairs, regardless of the damage amount.
Personal property coverage: Pays to repair or replace your belongings if they’re damaged in a flood. This includes your furniture, electronics, clothes, and any other items you own. The maximum personal property coverage limit with the NFIP is $100,000.
Each coverage also comes with its own separate out-of-pocket deductible, which is the amount you’re responsible for paying on each claim. Choosing a higher deductible will lower your flood insurance premium, but it will also reduce your claim payment.
How to buy flood insurance in California
California residents can buy flood insurance in one of two ways: through the NFIP, which is regulated and backed by the federal government and sold by insurance companies, or private flood insurance.
Private flood insurance vs. NFIP coverage
Private flood insurance generally gives you the option for higher coverage limits beyond the relatively low $250,000/$100,000 in coverage you’re limited to with the NFIP.
Additionally, private flood policies include coverages and perks that aren’t available through the heavily regulated NFIP. This includes loss of use coverage to help cover the cost of lodging or restaurant meals in the event your house is badly damaged and you’re forced to evacuate; or replacement cost coverage for your personal belongings.
Here’s a look at what California residents can expect with NFIP and private flood insurance.
NFIP | Private flood insurance | |
|---|---|---|
Maximum home rebuild limit | $250,000 | Typically up to $500,000 or higher |
Availability | Every county except Mariposa | May be limited in high-risk areas |
Waiting period | 30 days | As little as two weeks |
Accepted by mortgage lenders | Yes | Yes |
Replacement cost building coverage | Yes | Yes |
Replacement cost contents coverage | No | Yes |
Loss of use coverage | No | Yes |
Loss avoidance coverage (sandbags, etc.) | No | Yes |
Debris removal coverage | Yes | Yes |
Do I need flood insurance in California?
While you aren’t legally required to buy flood insurance, if your home is one of the approximately 506,137 in California in a FEMA-designated high-risk flood zone, your mortgage lender may require it as a stipulation in your loan agreement.
But even if your lender doesn’t require it, homeowners in flood-prone areas of California will want to consider this important piece of financial protection. While only around 4% of California homes are located in Special Flood Hazard Areas, around 25% of all flood insurance claims come from moderate- to low-risk areas, according to FEMA. [3]
Here’s a look at the total number of housing units and the percentage of all homes in high-risk flood zones for each county in California.
Regardless of which flood zone you live in, you’ll want to make sure you’re finding the best flood insurance at the most affordable rate. For the best flood insurance policy comparison, consider comparing both NFIP and private flood insurance plans with Policygenius.
Our team of licensed insurance agents at Policygenius can help you compare policies and find the best option for you.
