Frequently Asked Questions
Q. Is flood insurance intended to restore a loss to its pre-flood condition?
A. Flood insurance is intended to restore a covered loss to its pre-flood condition, less the deductible. Excluded items, such as a pier, landscaping, etc. are not covered under the current policy.
Click here for additional documents and video regarding policyholders’ rights to be restored to their pre-flood condition.
Q. Is flood insurance paid for by tax dollars?
A. No. Flood insurance premiums are paid by policy holders. In the event NFIP needs to pay out more than the premiums it has collected, the NFIP has the authority to borrow up to 1.5 billion dollars from the U.S. Treasury. All such loans must be repaid with interest.
As of September 2004, NFIP public records indicate that the program is currently more than 1 billion dollars in the black.
Q. Is flood insurance a form of federal aid?
A. No. Some flood trainers have this misconception and have errantly trained adjusters and agents.
Q. Does flood insurance cover contents?
A. Only contents coverage is specifically purchased. Unlike homeowners insurance that covers the dwelling and the contents, the current flood policy covers only the structure unless contents coverage is elected. Your declaration page will state the limits of coverage.
Q. What is the minimum deductible that can be carried?
A. Page D-11of the FEMA NFIP Seminar Forms Kit specifies that single family and 2-4 family building and contents policies may carry a deductible as low as $500 for structure and $500 for contents to as much as $5,000 for structure and $5,000 for contents.