Is Flood Insurance for Renters Recommended or Required?

Approximately 37 percent of renters have renters insurance, according to the Insurance Information Institute. While renters insurance covers common losses and damages resulting from perils like theft, vandalism, and fire, it does not cover everything. Most renters insurance policies do not cover damage caused by a flood. Similar to homeowners insurance, flood insurance must be purchased as a separate policy. While flood insurance is not required for renters, it should be seriously considered, especially for renters who reside in high-risk areas.

What Renters Insurance Does Not Cover

Renters insurance can protect tenants from the costs of unexpected personal property theft or damage. It can be purchased by anyone that rents a home, apartment, condo, or other living space. However, it does not cover all risks. Common coverage limits and exclusions in renters insurance policies may include:

• Bed bugs and other pests. Most renters insurance policies will not cover damage caused by bed bugs or other pests that may inhabit a home. Along with rodents, bug issues are considered a maintenance problem and are therefore excluded from most policies.
• Earthquake damage. Standard renters insurance does not generally cover damage caused by earthquakes. Renters at risk for earthquakes should consider acquiring separate earthquake coverage.
• Car damage or theft. A renters insurance policy will not cover damage or theft to a vehicle. However, any belongings inside the vehicle at the time of the theft may be covered by a renters policy.
• Flood damage. Floods are excluded from most basic renter’s insurance policies. This does not include flooding caused by a burst pipe or similar plumbing incident in an apartment.
• Roommate property damage. Renters insurance does not generally cover damage to a roommate’s property. To be protected, the roommate must be listed on the policy.

What Renters Flood Insurance Covers

Renters flood insurance may provide renters with coverage up to $100,000 for belongings damaged by flooding, according to the Federal Emergency Management Agency (FEMA). These funds can be used to replace items like clothing, electronics, and furniture owned by the renter. However, renter’s flood insurance does not cover the physical structure of the rental property. Instead, the landlord is responsible for any damage to the physical property.
Renters flood insurance can protect a wide range of items, such as:

• Washers and dryers
• Portable and window air conditioners
• Portable dishwashers
• Portable microwave ovens
• Food freezers and the food in them (not refrigerators)
• Carpets (unless installed over an unfinished floor)
• Curtains
• Valuable items like artwork up to a specified limit

The items covered by flood insurance differ depending on the area of the home impacted by the flood. Fewer belongings are covered when the flooding occurs in a basement. Most renters flood policies will only cover washers, dryers, food freezers, and portable and window air conditioners located in a basement. This is because basements are more susceptible to flooding hazards.

Area Levels of Risk Factors that Influence Premiums

Renters face different levels of flood risk based on their location. Renters who reside in moderate to high flood risk areas are encouraged to purchase renter’s flood insurance. However, even renters who live in low-risk flood areas should consider acquiring a policy for protection and peace of mind. FEMA provides flood maps that detail which areas in the U.S. are most prone to flooding. These areas are divided based on several factors, such as their proximity to water and elevation.

The zones and associated levels of risk include:

• Zone V – High risk flood hazard
• Zone A – High risk flood hazard
• Zone B – Moderate flood hazard
• Zone X – Moderate flood hazard
• Zone C – Minimal flood hazard

According to a report published in the journal Environmental Research Letters, the homes of an estimated 3.9 million Americans are at risk of flooding within the next century if sea levels rise one foot. Some states in the U.S. are more at risk for flooding than others, including Georgia, Massachusetts, North Carolina, South Carolina, Virginia, New Jersey, New York, California, Louisiana, and Florida.

Call JMG For A Renters Flood Insurance Quote

Many renters are unaware that they can purchase flood insurance to protect their belongings. While standard renters insurance can be highly useful when faced with peril like theft, vandalism, or fire, it will not protect against certain risks like water damage caused by floods. As a renter, it is recommended to have separate or add-on flood coverage.

As renter’s flood insurance does not cover the structure of the home, it is often more affordable than homeowner’s flood insurance policies. Flood insurance premiums are typically calculated based on the occupancy of the building, the location of the contents, how many floors are in the building, the risk of flooding in the area, the year in which the building was constructed, and similar factors. For more information or to acquire a renters flood insurance policy, speak to the insurance experts at John M. Glover.