What is a Flood?

TypTap is based in Florida so as you might imagine Hurricane Irma has been a big topic of conversation over the last few months; and most of these conversations are discussing claims.  According to the Florida OIR (Office of Insurance Regulation) just under half of those claims have been closed without payment. Many policyholders, not knowing the difference between what is and isn’t covered on a home and flood policy, had their claims closed without payment because they did not have – but needed – flood insurance. It is not uncommon for there to be confusion when it comes to the different types of water losses covered by homeowners insurance versus flood insurance. Our biggest piece of advice to policyholders is to not be afraid to ask your agent questions or even do some research of your own (Hey! You’ve started that by reading this blog post!). For the purposes of this post we are going to specifically talk about flood insurance and what constitutes a flood. Let’s start with the description of a flood, per the TypTap policy language: Flood- as used in this policy means:
  1. 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 neighboring properties (at least one of which is your property) from:
  2. Overflow of inland tidal waters;
  3. Unusual and rapid accumulation or runoff of surface waters from and source; or
  4. “mudflow”: or
  5. Collapse or subsidence of land along the shore of a lake or similar body of water as a result of erosion or undermining caused by waves of water exceeding anticipated cyclical levels that result in a “flood” as defined in a.(1) above.
And in comparison, here is standard Homeowners policy contract regarding the exclusion of flood: Water Damage, meaning:
  1. Flood, surface water, waved, including tidal wave and tsunami, tides, tidal water, storm surge, overflow of any body of water, or spray from any of these, all whether or not driven by wind, including storm surge;
Let’s continue with Irma as an example to explain the above with real life scenarios.
  1. You live near a river and the river overflows all around your neighborhood and the water seeps in to your house, this would be covered by your flood insurance policy.
  2. Powerful winds cause your tree to land on your roof creating a hole for the rainwater to accumulate inside: wind is the cause of damage so your homeowners policy would cover this.
  3. A pipe burst in your house and water goes all over your hardwood floors: this is internal water damage and therefor covered by your homeowners policy.
  4. Heavy rains inundate the area, water rises and enters your property and your neighboring property: flood insurance would cover this.
If your home is in a high-risk flood zone and your home has a mortgage you are required to purchase a flood policy to protect your home. However, according to FEMA over 20% of all flood insurance claims happen in low-to-moderate risk areas, often causing damage to homes with no flood insurance. Many of these homeowners do not carry flood policies because of the misconception on the requirement to have flood insurance and what type of policy will pay when damage occurs. For more information and for a flood quote in seconds, policy in minutes please visit www.typtap.com