As the 2017 hurricane season gains strength following Hurricane Harvey in Texas, residential and commercial property owners along the Gulf of Mexico and in other coastal or low-lying regions across the country are likely to be double checking their insurance coverage.

Damage caused by flooding is not typically covered by homeowners and renters insurance policies. Rain-related damage may, however, be covered.

Property owners who hold a mortgage on a home or commercial building located in certain zones at high risk of flooding are required by law to purchase flood insurance, under Congressional rules applicable to federally regulated or insured lenders.

The National Flood Insurance Program (NFIP) is a federal program that offers flood insurance at favorable market rates to homeowners and other property owners.

According to the NFIP, flood insurance covers direct physical loss caused by flooding conditions. A flood is considered to be “an excess of water on land that is normally dry.” Floods are generally considered to be caused by an overflow of inland or tidal waters, the rapid accumulation of surface waters, and related circumstances.

Homeowners in flood zones who do not hold a mortgage on a property may not realize that flood-related damages may not be covered by a homeowners policy. Renters who live in flood zones may also be at risk of not having coverage for damage relating to flooding.

Harvey Home Flood Insurance ExpertAccording to the National Association of Insurance Commissioners, flood insurance typically covers structural damage to a property, including damage to a furnace, water heater, air conditioner, flooring, and debris clean-up. The contents of a property (furniture, clothing, etc.) are not typically covered by a basic flood insurance policy. The amount of coverage provided by a flood insurance policy may be determined by replacement cost, actual cash value, or a specified policy limit.

Insureds under a homeowners or business owner policy are advised to speak with their insurance agent to understand the terms of their insurance policies, including flood coverage and any deductibles that may be associated with hurricane conditions.

A Look Back at Superstorm Sandy Insurance Claims

Superstorm Sandy, which struck the U.S. East Coast on October 29, 2012, gives a perspective on the scope and variety of claims that can be associated with a major weather event. One year after the storm made landfall, report that economic losses from the storm totaled an estimated $70 billion.

Approximately $25.85 billion of these losses were insured, and included auto, homeowners and business insurance claims ($18.75 billion) as of late 2013. The balance of claims ($7.1 billion) were paid by the National Flood Insurance Program.

Private insurance companies processed about 1.58 million claims in the year after Sandy struck, with homeowners claims responsible for the majority (71.5 percent) of these claims.

Bill Hager’s Homeowners Insurance Policy Expertise

Mr. Hager has had extensive and substantive experience relating directly to homeowners insurance policies including interpreting policy language and determining the insurer’s obligations under such policies.

He served as a regulator for eight years in five positions:

  • Commissioner of Insurance (Iowa);
  • First Deputy Commissioner of Insurance;
  • Member of the National Association of Insurance Commissioners (NAIC);
  • Administrative Law Judge f/k/a Hearing Officer at the Department of Insurance (IA); and
  • Assistant Attorney General assigned on a full-time basis to the Department of Insurance.

In these capacities, he and his staff approved (or disapproved) of the language of homeowners insurance policies used by each of the 1,000 property casualty insurance companies (many of whom sold homeowners insurance) doing business in the state of Iowa. This regulatory action also included the approval of policy application forms like that at issue in many homeowners insurance cases. Homeowners insurance is conducted in a similar manner throughout the U.S.

While Commissioner, Mr. Hager also served as a member of the National Association of Insurance Commissioners (“NAIC”) and participated as a member of its Executive Committee.

Click on the link to read more about Mr. Hager’s background as a homeowners insurance expert.


Material for this article was taken from a collection of industry sources relating to the subject.

In all of the general statements here, see the state law of the controlling jurisdiction. Every case is different and circumstances vary widely depending on the governing state law, policy provisions, and related considerations.

This blog is provided for educational purposes only. It is not intended to provide legal advice or an opinion in regard to any topic discussed. The blog should not be used as a substitute for legal advice from a licensed attorney in your state.