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There’s a common question that is frequently asked among the insurance industry, “What is the difference between Flood Insurance and Water Backup coverage”?  This is a great question and we feel it’s very important customers understand the differences.  Flood Insurance and Water Backup coverage can be a little complex, making it difficult to understand.  A few key things to always keep in mind when it comes to Flood Insurance are:

· "Floods are the most common and costliest natural disaster the United States has to endure every year" (FEMA).

· Flood Hazard Area:  “26% chance that you will experience flood damage over a 30 year mortgage” for homes in a Special Flood Hazard Area" (FEMA).  Mortgage companies can require a Flood policy for any home located in special flood hazard areas.

· Flood Insurance usually covers damage due to:

o   Rising Water

§  Rain

§  Melting snow

§  Overflowing rivers

§  Mudslides

o   Collapse of land along a shore from unusual waves or current

· 2 types of Flood Insurance:  Building and Personal Property

· Flood Insurance takes 30 days until it even becomes effective and it must be paid in full (some exceptions apply)

· Flood Insurance is essentially run by the federal government and they must deem it a flood for your policy to kick in.  Key things that must occur for it to be deemed a flood are:

o   It must affect at least 2 properties or 2 acres of land

o   It must be declared a flood area

· Flood insurance is a completely separate policy from you Homeowner’s policy.  It was previously purchased directly through the NFIP, but now you are also able to purchase this policy via many of your local independent insurance agencies.

As you can see flood insurance can be extremely difficult to keep up with if you are somebody who does not specialize in the insurance industry.  We focused on coverage provided by National Flood Insurance Program (NFIP/FEMA) because that is by far the most common way is it purchased.  However, other products are being introduced to the market that are not are part of NFIP.  More complete details about Flood Insurance through NFIP please visit

Water Backup coverage may not be as complex, but can tend to be confused with Flood Insurance.  Water Backup coverage is completely different than flood insurance in many ways:

· Water backup usually covers damage due to:

o   Sewer or drain backup

o   Sump pump failure

· Not typically covered under water backup:

o   Surface water

o   Foundation seepage: water leaks through cracks in the foundation of your home. There are many companies out there who you can hire to help limit these risks.

· Water Backup coverage almost always has a limit (such as 5,000 or 10,000) and may have a separate deductible on your homeowner’s policy.

· Water Backup coverage is not a separate policy from your homeowner’s policy but instead is usually a rider/endorsement that could be added. 

The information provided above is geared toward residential properties, but the applications are similar for commercial properties.  This is a brief outline of the difference between Flood Insurance and Water Backup coverage, for more complete details it is best to read your policy or consult a licensed insurance agent.  Agents at Davis & Massey are more than happy to answer any additional questions on this or other topics.  Contact us at (843) 839-9229.

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