In Minnesota, extreme rain events are becoming more common, and can occur almost all year. Risks associated with flooding are changing. More structures are affected by landslides and rivers eroding and moving during floods.
Mapped Flood Zones
Approximately 50% of flood damage occurs outside mapped flood zones, often due to stormwater flooding. Buildings mapped in flood zones for high-risk areas are five times more likely to be damaged by flooding than by major fires.
Buildings on the edge of high-risk flood zones have a 26% chance of flooding over 30 years. Those in the "10 year" floodplain have a 96% chance of flooding over 30 years.
Hazard insurance policies do not cover flooding (in most cases) for homes and businesses. Anyone in a community that participates in the National Flood Insurance Program can purchase flood insurance. Flood insurance is required for all buildings in mapped high-risk flood zones that are financed by federally backed loans or mortgages.
- Flood Insurance - what it covers and what it doesn't
- Answers to Questions about the National Flood Insurance Program
- National Flood Insurance Program Claims Manual
- Flood Insurance Manual
- Why Do I Need Flood Insurance?
- National Flood Insurance Program Summary of Coverage
- What Every Minnesotan Should Know About Flood Insurance
Frequently Asked Questions
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Who can or must buy flood insurance?
- Who can purchase flood insurance?
Anyone who lives in a community that participates in the National Flood Insurance Program (NFIP) can buy flood insurance. More than 95% of all Minnesotans live in a community enrolled in NFIP. It is not necessary for your property to be mapped in a high flood risk area (1% annual chance or "100-year" floodplain) to be eligible to purchase flood insurance.
- Can renters purchase National Flood Insurance Program flood insurance?
Yes! NFIP flood insurance is sold separately for contents coverage. Renters can purchase up to $100,000 coverage for contents.
- Who is required to get flood insurance?
Property owners are required to purchase flood insurance if the insured structure is located within the high flood risk area (1% annual chance or "100-year" floodplain) and if the property has a mortgage or loan on it from a federally regulated institution. Carrying flood insurance is also a requirement in order to obtain certain types of disaster aid.
Flood insurance is mandatory if the structure is in the high flood risk area. It is not mandatory if just unimproved land is in the high flood risk area, however, a lender may have a policy of requiring flood insurance.
- My bank is requiring that I purchase flood insurance, but don't believe my structure is in a floodplain. How do I appeal this decision?
A lending institution must require that flood insurance be purchased as a condition of any federally insured loan when a building is mapped in the 100 - year floodplain. The property owner may file a Letter of Map Amendment (LOMA) with FEMA to appeal a determination. Your local community can help guide you through this process.
What is my risk? Should I get flood insurance?
- How can I find out the level of flood risk on my property?
Go to " What’s My Flood Risk" at floodsmart.gov to find your level of risk on the official FEMA Flood Insurance Rate Map (FIRM) for your community.
- Can't I just get disaster assistance if a flood occurs?
Not necessarily. Federal disaster assistance is only available if the President of the United States formally declares a disaster in that county. Even if your county is declared, most disaster assistance is in the form of a loan that you have to repay, with interest, in addition to your mortgage loan that you still owe on the damaged property. If your home is flooded and disaster assistance isn't offered, you'll have to shoulder the damage costs alone.
Options for Buying National Flood Insurance Program Flood Insurance
- Where do I buy National Flood Insurance Program flood insurance?
NFIP flood insurance is sold through private insurance companies and agents, and is backed by the federal government. Check with your insurance agent for available options. You can also visit floodsmart.gov to find an agent.
- How much flood insurance should I buy?
For federally secured financing in the FEMA-mapped high flood risk area, the law requires flood insurance in an amount equal to the outstanding principal balance of the loan, the value of the building, or the maximum coverage available, whichever is less. It also requires flood insurance to be maintained for the life of the loan.
While the law requires coverage only for the loan balance, you should consider fully protecting your building and its contents.
The NFIP provides up to $250,000 coverage for single-family residential buildings and up to $100,000 coverage for contents. Businesses can obtain up to $500,000 coverage for buildings and up to $500,000 coverage for contents. Other residential property owners can also obtain flood insurance.
National Flood Insurance Program Community Participation
- How do I find out whether my community is enrolled in the National Flood Insurance Program?
- How many flood insurance policies are there in Minnesota?
As of June 2016, there were 9,991 flood insurance policies in Minnesota. Fourty four percent were for structures in a high flood risk area (the "100-year" or 1 percent annual chance floodplain). More than half of the flood insurance policies in Minnesota were in the medium flood risk (the "500-year" floodplain) or the low flood risk (no mapped flood risk) zones. Those with the policies in the "low risk" areas are recognizing that local conditions put them at a higher risk than what is acknowledged on the FEMA maps.
- What are the impacts of my community not participating in the National Flood Insurance Program. Can I still get flood insurance?
If you live in a community that is not enrolled in the NFIP and want to purchase flood insurance, you will have to search for an agent or company willing to underwrite a private policy. Those policies are usually much more expensive than the policies available through the NFIP. You could contact your local officials and urge them to enroll your community in the NFIP .
- Doesn't my homeowner's policy cover flooding?
No. In most cases, flood damage is not covered by homeowners’ policies.
- What does National Flood Insurance Program flood insurance cover?
Flood insurance coverage depends on the policy purchased. Policies exist for both building and contents coverage. Federal law mandates purchase of building coverage if the insurable structure is in a FEMA mapped high-risk flood zone. Home and business owners need to ask questions if it is unclear whether the NFIP flood insurance includes the building coverage, contents coverage or both. (The exception is with a "Preferred Risk Policy", or PRP, where the building and contents coverage is bundled together in set increments).
- How much flood insurance coverage is available?
Coverage Limits for 1 to 4 family structural coverage is $250,000. 1 to 4 family contents coverage is $100,000. Other residential structural coverage is $500,000. Other residential contents coverage is $100,000. Business structural coverage is $500,000. Business contents coverage is $500,000. Renters contents coverage is $100,000.
- Does the National Flood Insurance Program flood insurance cover groundwater seepage?
In most cases, the answer is no. NFIP flood insurance covers direct physical losses caused by "flood".
For the NFIP flood insurance program, a "flood" is defined as 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 properties (at least one of which is your property) from:
- Overflow of inland or tidal waters;
- Unusual and rapid accumulation or runoff of surface waters from any source;
- Mudflow*; or
- 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 or currents of water exceeding anticipated cyclical levels that result in a flood as defined above.
* Mudflow is defined as "A river of liquid and flowing mud on the surfaces of normally dry land areas, as when earth is carried by a current of water."
- Can I get covered for landslides caused by heavy rainfall?
NFIP flood insurance and most homeowners' insurance policies do not cover landslides.
- Does the National Flood Insurance Program flood insurance cover sewer backups?
NFIP flood insurance only covers sewer backups if it can be shown it was directly related to a condition of flooding in the area. Sewer backup is not usually covered by standard homeowners' insurance. A separate endorsement is available from most insurance companies. Ask your agent about its availability.
- What is the deductible and should I consider a higher deductible?
The standard minimum deductible ranges from $1,00 to $1,500 for coverage of $100,00 or less and ranges from $1,250 to $2,000 for coverage over $100,000. The deductible is separate for the building and contents coverage.
It is possible to reduce the annual premium cost by choosing a higher deductible of $3,000, $4,000, $5,000 or $10,000 for either or both the building and contents coverage. Carefully consider whether a higher deductible is a good option based on the type of flooding and damage you are most likely to experience.
- Does the National Flood Insurance Program flood insurance offer any type of basement coverage?
Yes, it does. The NFIP defines a basement as any area of a building with a floor that is below ground level on all sides. While flood insurance does not cover basement improvements (such as finished walls, floors, or ceilings), or personal belongings kept in a basement (such as furniture and other contents), it does cover structural elements and essential equipment.
- What is insured under building property coverage?
- Foundation walls, anchorage systems, and staircases attached to the building.
- Central air conditioners.
- Cisterns and the water in them.
- Drywall for walls and ceilings.
- Nonflammable insulation.
- Electrical outlets, switches, and circuit breaker boxes.
- Fuel tanks and the fuel in them, solar energy equipment, well water tanks and pumps.
- Furnaces, hot water heaters, heat pumps, and sump pumps.
- What is insured under personal property coverage?
- Washers and dryers.
- Food freezers and the food in them (but not refrigerators).
- Portable and window air conditioners.
- What is not insured by either building property or personal property coverage?
- Paneling, bookcases, and window treatments such as curtains and blinds.
- Carpeting, area carpets, and other floor coverings such as tile.
- Walls and ceilings not made of drywall.
- Most personal property such as clothing, electronic equipment, kitchen supplies, and furniture.
- My structure has been severely damaged. Will flood insurance cover the costs of getting my house in compliance?
NFIP flood insurance includes a rider to the policy for Increased Cost of Compliance (ICC). ICC provides up to $30,000 for the additional cost to bring the structure into compliance with local floodplain management regulations. ICC can pay the cost for elevation, relocation, demolition or floodproofing (non-residential only) the structure.
A person's ICC claim is an endorsement to your Standard Flood Insurance Policy. A person can only file an ICC claim if the structure is in a Special Flood Hazard Area and their community determines that a home or business has been substantially damaged (the cost to bring it to the pre-disaster condition is more than 50% of the structure’s market value) by a flood. This determination is made when a person applies for a building permit to begin repairing their home or business. If a community does determine that a home or business is damaged, a local official will explain the floodplain management ordinance provisions that a person will have to meet. At that time, the policy holder contacts the insurance company or agent who wrote the flood policy to file and ICC claim. The insurer will assign a claims representative who will help a person process their ICC claim. A person should start getting estimates from contractors to take the necessary steps to elevate, relocate, floodproof, or demolish.
Cost of Flood Insurance
- How much does flood insurance cost?
In Minnesota, the average annual premium is $849 (as of June 2016), but can range from less than $200 annually for building & contents coverage through a Preferred Risk Policy outside of the high flood risk area to tens of thousands of dollars for non-compliant post-FIRM structures (for structures built after FEMA Flood Insurance Rate Map showed area as high flood risk).
The main factors are your level of risk, the amount of coverage you need, the elevation of your lowest floor compared to the calculated 1% annual chance ("100-year") flood, and whether your structure was built (or substantially improved) before or after the FEMA first Flood Insurance Rate Map (FIRM) mapped the area as a high flood risk area.
Go to floodsmart.gov for a "One-Step Flood Risk Profile". This profile will help you...
- determine whether you are in a high, medium or low flood risk area
- give you estimates of flood insurance premiums for your situation
- find an insurance agent
- Rate Comparison Information Sheet
- How can I reduce the cost of my flood insurance policy?
Flood insurance premiums are based on risk. As flood risk increases, flood insurance premiums also increase. A couple of very common methods to reduce future losses and your premium is to raise your building above the base flood elevation standards or to floodproof your non-residential building. Other methods include relocating your structure out of the floodplain, elevating utilities, installing engineered flood openings, or filling your basement to raise the lowest floor elevation. Information on floodproofing and retrofitting structures located in the floodplain is available.
Additionally, you may see reduced premiums if your community participates in the Community Rating System (CRS). CRS communities have undertaken a proactive effort to adopt higher standards and flood mitigation best management practices which exceed the federal minimum requirements. Residents of these CRS communities qualify for lower insurance premiums.
Submitting a Claim
- How do I submit a claim for flood losses?
FEMA provides a basic step-by-step process for submitting flood claims and also publishes their Flood Insurance Claims Handbook.
- My county is getting a new FEMA Flood Insurance Rate Map. How will that affect me?
As new maps are developed, designation of structures not previously located within a special flood hazard area will change and be required to obtain flood insurance. There is an option to get a discounted premium if the policy is bought within a year of the new map effective date.
- My property is protected by a levee. Does this mean that I don't need flood insurance?
No! Flood insurance still provides important protections for the property owner. Levees are artificial structures that are designed to protect against floods of certain magnitudes. It is always possible for a flood to exceed the design magnitude, resulting in overtopping of the levee and flooding behind it. In addition, levees are artificial structures requiring regular maintenance: they can and do fail.
Many levees were constructed at the time of flooding with available materials, and were never certified to meet the federal standards for protection from the 1% annual chance (or "100-year") flood. Areas behind these emergency levees will be shown as high flood risk areas. It's as if these levees don't exist when it comes to the mandatory flood insurance requirements.
Some of these emergency levees are eligible for PL 84-99 "Non-Federal Flood Control Works Inspection Program" (PL-84-99), which is administered by the U.S. Army Corps of Engineers. Through this program, the Corps assists with regular inspections and recommendations to the community on operations and maintenance. These levees can provide important flood protection, especially when properly maintained, but the properties behind these levees will still be considered to be in the high flood hazard area (1% annual chance flood area).
If a levee has been accredited as providing satisfactory protection against the 1% annual chance flood event, FEMA considers property behind the levee to be out of the floodplain for insurance purposes and any affected property owners would be able to purchase flood insurance at reduced rates. Such levees are included on Flood Insurance Rate Maps, with the affected area mapped as Outside of the Floodplain (Zone X on the maps) but shaded to indicate the area's flooding potential in the event of levee failure; such maps also display a note warning of the consequences of levee overtopping or failure.
These levees are aging. Many were built in the 1960s, or earlier. As FEMA updates the flood risk mapping for a county, the levees are being re-evaluated to verify they still meet the certification standards in 44 CFR Section 65.10 (the federal regulations that lay out the technical standards).