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As we witness the devastation in Houston, and send the residents of TX and LA our support, now is a good time to revisit our understanding of how insurance responds to a hurricane, water damage and flood. There is a distinction between all three, and even if you carry flood insurance, you may find yourself paying for damage out of your own pocket.

Homeowners’ insurance will pay for the water damage caused by a burst pipe (but not for the expenses involved in repairing the pipe). In general, homeowner’s insurance will pay for water damage caused by rain. For example, if during a hurricane, the wind rips the roof from your home, exposing it to rain, your policy will pay for the resulting water damage. Homeowners’ insurance excludes any damage caused by flood, surface water, waves, tidal water, overflow of water, or spray from any of these, whether driven by wind or not.

A flood insurance policy can protect you from some, but not all, of the potential expenses you might incur in the event of a flood. A flood is defined as a general and temporary condition of partial or complete inundation of two or more acres of normally dry land area or of two or more properties (at least one of which is yours). The water must come from overflowing inland or tidal waters, or rapid accumulation or runoff of surface waters. If these conditions aren’t met, a flood insurance policy will not respond to the claim.

Primary flood insurance provides limits of up to $250,000 on a dwelling and $100,000 on contents. The policy covers the cost to rebuild the dwelling, the actual cash value (ACV=replacement cost minus depreciation), or the policy limit, whichever is less. Contents are covered at ACV. A flood policy does not cover decks, patios, plants, sheds, pools, septic systems, wells and other outdoor property. Flood insurance restricts coverage for basements, crawlspaces, and any living area below ground level, including walkout basements. And finally, a flood policy does not provide coverage for temporary housing and additional living expenses during the time the house is being repaired.

2011 Hurricane Irene flood, Deerfield River in Shelburne Falls, MA

2011 Hurricane Irene flooding on the Deerfield River in Shelburne Falls, MA. Photo credit: conrailSD40guy on YouTube