How Much Does Flood Insurance Cost?

I understand that homeowners insurance doesn't cover flooding. How much does flood insurance cost?

The federal government offers coverage through the National Flood Insurance Program at an average cost of about $700 per year. But premiums vary depending on your property's flood risk.

For low-risk homes with the maximum coverage of $250,000 for the dwelling and $100,000 for possessions, the premiums are $405 per year, or $452 if you have a basement. You'll also pay a new surcharge of $25 for primary residences, or $250 for nonresidential property and second homes. Similar coverage can cost more than $2,500 in a higher-risk area.

You can look up the risk of flooding for your address and get price quotes at FloodSmart.gov. Your mortgage company may require you to get flood insurance if you live in a high-risk area, but the coverage can be valuable even if your lender doesn't require it. From 2008 to 2012, the average residential flood claim was more than $38,000. Homeowners insurance typically covers damage that comes from the top down—such as rain and wind damage—but it doesn't cover rising water and flooding.

Ask your homeowners insurance agent if he or she sells federal flood insurance policies. Some insurers, such as Chubb and Fireman's Fund, let you buy extra coverage on top of the federal plan's limits. Or you can find a local agent at FloodSmart.gov. The Web site also has a tool that shows how much flood damage is likely to cost you, based on the number of inches of flooding and the size of your home (with a breakdown of the types of items that would be damaged during a flood of that level). For example, the tool shows that a 6-inch flood in a 2,000-square-foot home could result in $39,150 in damages.

Now is a good time to buy a policy. There's a 30-day waiting period before coverage kicks in, and hurricane season begins on June 1. For more information about storm preparation, see How to Protect Your Home and Finances From Spring and Summer Storms.