Flood Insurance for Renters

As a renter, you may have reasons why you think you won’t need flood insurance.

First, you might underestimate your risk of a flood. But flooding is the most common and expensive natural disaster in the U.S. And there’s a good chance you live in one of the 99% of counties in the U.S. that were impacted by flooding between 1996 and 2019, according to the Federal Emergency Management Agency (FEMA).

Second, you might assume that your renters insurance covers flood-related damage. But that would be a major oversight. A standard renters insurance policy does not cover flood damage. So if a flood impacts your local area and destroys your personal belongings, you would have to pay out-of-pocket to replace your stuff.

If you want coverage for flood-related damage, you may have the option to buy renters flood insurance from FEMA. Here’s what to know.

What Is Flood Insurance for Renters?

Renters flood insurance is a separate policy that pays to repair or replace your personal property if it is damaged during a flood event. This includes items like clothes, furniture and electronics.

For example, if your home is flooded after a torrential rain storm or hurricane, flood insurance could pay to replace your rugs, couch and other items if they were destroyed.

Most folks buy renters flood insurance from the National Flood Insurance Program, which is managed by FEMA. You can buy a policy to cover your contents (personal belongings) up to $100,000.

What’s Covered by Flood Insurance for Renters?

Renters flood insurance from the NFIP covers your the contents of your home, which includes items such as:

• Clothing
• Electronics, such as a television and laptop
• Furniture
• Valuables, such as jewelry and artwork (up to $2,500)
• Books
• Rugs
• Kitchen items, such as pots and pans
• Mini fridges
• Portable microwaves and dishwashers
• Portable and window air conditioners
• Portable clothes washers and dryers

You can make an insurance claim for these items up to your flood insurance policy limit, and reimbursement is based on actual cash value, which deducts for depreciation over time.

NFIP flood insurance for renters does not cover “additional living expenses” if you cannot live in your home because of flood damage. For example, it won’t cover hotel bills or restaurant meals.

Renters flood insurance also does not cover the physical building, such as damaged floors, walls or the structure. That would fall under your landlord’s flood insurance.

Why Buy Flood Insurance for Renters?

A standard renters insurance policy excludes coverage for flood damage, meaning you won’t be covered if a flood destroys your belongings.

While floods are often associated with hurricanes, they are are hardly relegated to the Atlantic coastal region. Between 2015 and 2019, 40% of NFIP claims came from areas outside high-risk flood areas. Floods are the most common and widespread natural disaster in the U.S. They can happen within minutes from a hurricane or over a long period of rain.

Floods can occur during:

• Heavy rains
• Ocean waves that come on shore
• When snow melts quickly
• When dams or levees break

Flash floods are the most dangerous types of floods, according to the National Oceanic Atmospheric Administration. They happen when the ground is unable to absorb rainfall. They also happen when water fills normally dry creek beds or streams and causes an overflow. Flash floods can happen within minutes and without warning.

If you are affected by a flood and located in a disaster declared county, you may be able to get a home and property disaster loan from the Small Business Administration. Renters can get up to $40,000 to repair and replace personal property.

But it’s not a good idea to rely on government aid. It can take many months to get the loan and the amount may be insufficient to replace your items. And you’ll be required to pay the loan back at an interest rate between 4% and 8%, with loan terms as long as 30 years.

How Do I Get Renters Flood Insurance?

To get a flood insurance policy from the NFIP, you must live in a community that participates in the NFIP. To find out if your community participates, you can ask your insurance agent or check the National Flood Insurance Program Community Status Book.

Note that the NFIP has a 30-day waiting period after purchase before a new flood insurance policy is effective. If you need flood insurance, it’s a good idea to buy it as soon as possible.

How Much Does NFIP Renters Insurance Cost?

Renters flood insurance costs will depend on the amount of coverage you choose and the deductible amount. The cost will also depend on several other factors based on FEMA’s Risk Rating 2.0, which is FEMA’s new methodology for calculating flood insurance rates. These factors include:

• The building location
• Year of building construction
• Number of floors
• Total number of units in the building
• The building’s flood risk
• Claims history of the building

Risk Rating 2.0 rates will be effective for new policies written on or after Oct. 1, 2021. The rates will go into effect for existing policyholders who are renewing on or after April 1, 2022.

Renters Flood Insurance FAQ