A flood occurs when water from an external source, such as rain, overflowing rivers, or storm surge, inundates what is normally dry land. To be considered a flood loss, the water must come from an external source.  

It’s common to hear terms like “flooded basement” used loosely, but in many cases, those losses are actually caused by a type of sewer/drain backup. In insurance terms, Flood coverage specifically applies to water entering from the outside of the property, not from within. 

Flooding isn’t limited to high-risk areas. In fact, a significant percentage of flood losses occur outside of these zones. Even properties in moderate-risk zones have over a 25% likelihood of flooding over the course of a 30-year mortgage—that’s more likely than a fire!  

Because of this, we strongly encourage offering Flood coverage to all clients. If coverage is declined, make sure the client understands their exposure and the risks of going without Flood insurance for their rental property.  

Properties with 1-4 units can obtain up to $250,000 of coverage and 5-20-unit properties can obtain up to $500,000 of coverage, subject to a $1,000 deductible ($5,000 in Massachusetts).