Home > Flood Insurance Flood insurance is not normally included in a standard homeowner's insurance policy. It serves to compensate the policyholder in the event that their home, residence, or property sustains damage due to flood. A homeowner is eligible to purchase flood insurance only if their community participates in the National Flood Insurance Program (NFIP). The NFIP was established in the 1960s as a solution to private flood insurance, which did not support itself very well for a number of reasons. Tens of thousands of communities are now active in the NFIP program. The participating communities and the Federal government act in reciprocity; the communities are required to comply with preventive flood management ordinances, in exchange for federally supported flood insurance which is sold by private agencies to homeowners and residents. This flood management partnership helps to save hundreds of millions of dollars per year in damages to residences. Homes built and maintained in compliance with NFIP standards are far less likely to sustain damage during a flood disaster. FEMA, or the Federal Emergency Management Agency, is the managing agency of the NFIP. FEMA defines geographic flood zones according to the relative flood risk factors. These zones can be analyzed through the use of a Flood Hazard Boundary Map or a Flood Insurance Rate Map. FEMA performs a Flood Insurance Study (FIS) of a community in order to determine the degree of flood risk. A flood risk map is created through the analysis of a variety of flood risk factors. Areas termed Special Flood Hazard Areas (SFHAs) are designated due to the inherent flood risk. Flood insurance is required in order to build, buy, or improve any type of structure which lies within one of these areas. Federally regulated mortgage lending agencies are required to determine if a building or building site is located within one of these areas, and notify the borrower that flood insurance is required in conjunction with the loan. A flood insurance policy normally covers structural damage, appliances, mechanical devices, floor surfaces, electronics, computers, lamps, decorative items, furniture, clothing, housewares, cleanup, and other damage. There are 3 general policy forms available: Dwelling - Includes homes General Property - Includes businesses and apartments Residential Condominium Building Association - Condos People who rent their home may exercise their option to purchase contents coverage, which protects their personal belongings contained within a rental property in the case of flood damage. There is normally a waiting period of 30 days which must pass between the initial purchase of a flood insurance policy and the actual beginning of coverage.