Flood Insurance

March 1, 2013

Since standard homeowners insurance doesn’t cover flooding, it’s important to have protection from the floods associated with hurricanes, tropical storms, heavy rains and other conditions that impact the U.S.

In 1968, Congress created the National Flood Insurance Program (NFIP) to help provide a means for property owners to financially protect themselves. The NFIP offers flood insurance to homeowners, renters, and business owners if their community participates in the NFIP. Participating communities agree to adopt and enforce ordinances that meet or exceed FEMA requirements to reduce the risk of flooding.


The National Flood Insurance Program (NFIP) is administered by the Federal Emergency Management Agency (FEMA), which works closely with nearly 90 private insurance companies to offer flood insurance to property owners and renters. In order to qualify for flood insurance, a community must join the NFIP and agree to enforce sound floodplain management standards.

The NFIP, a federal program, offers flood insurance, which can be purchased through Dave Terpening Insurance Agency, Inc. Rates are set and do not differ from company to company or agent to agent. These rates depend on many factors, which include the date and type of construction of your home, along with your building’s level of risk.

Building Versus Contents Coverage

Flood insurance protects two types of insurable property: building and contents. The first covers your building, the latter covers your possessions; neither covers the land they occupy.

Building coverage includes:

  • The insured building and its foundation
  • The electrical and plumbing system
  • Central air conditioning equipment, furnaces, and water heaters
  • Refrigerators, cooking stoves, and built-in appliances such as dishwashers
  • Permanently installed carpeting over unfinished flooring.

Contents coverage includes:

  • Clothing, furniture, and electronic equipment
  • Curtains
  • Portable and window air conditioners
  • Portable microwaves and dishwashers
  • Carpeting that is not already included in property coverage
  • Clothing washers and dryers

The two most common reimbursement methods for flood claims are: Replacement Cost Value (RCV) and Actual Cash Value (ACV). The RCV is the cost to replace damaged property. Owners of single-family, primary residences are typically qualified for reimbursement at a certain percentage rate.

All other buildings and personal property (i.e. contents) are valued at ACV. The ACV is the RCV at the time of loss minus physical depreciation. Personal property is always valued using the ACV.

For assistance with your flood insurance requirements please call us at 1-800-585-1776 and one of our property and casualty agents will help you.

Post author Loren Pleet