Key takeaways
- Flood zone disclosure is not mandatory in every state, and many buyers do not learn about a property's flood status until it is too late to factor the cost into their decision.
- Under federal law, flood insurance is mandatory for any federally backed mortgage on a property in a Special Flood Hazard Area.
- Properties in moderate- to low-risk areas accounted for 29% of all flood insurance claims between 2014 and 2024, according to FEMA, and the average claim payment from 2020 to 2024 was $82,614.
Flooding is the most common natural disaster in the United States, and if you own a home, you are likely at some risk of water damage.
Here are eight things to understand before buying in a flood zone.
1. Weather is not the only cause of flooding
Floods can happen anywhere in the country at any time of year, and they do not require a major storm. Poor water diversion from nearby construction, a clogged storm drain or a burst pipe can flood a ground floor in a matter of hours.
2. Find out whether the home is in a flood zone before you buy
Do not wait until closing to learn about the property's flood status. Flood zone disclosure is not mandatory in every state, and many homebuyers do not find out until closing or even afterward.
Before you make an offer:
- Ask your real estate agent, insurance agent or lender about the property's flood designation.
- Look up the property on the Federal Emergency Management Agency flood map.
- Get a quote on what flood insurance will cost over the life of your mortgage.
If the property is in a rural area or an area with new construction, the address may not yet have a flood evaluation on file.
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3. Low flood risk does not mean you will not need insurance
Even when the risk of flooding is relatively low, most lenders will require flood insurance because the property is their collateral. If the home is at any risk of flooding, the lender's exposure needs to be offset, and that cost is passed to you. Expect to pay more to live in a flood zone, even a low-risk one.
4. Homeowners insurance rarely covers flooding
Even the most expensive homeowners policies rarely cover flood damage. Floods can result from spring thaws, snowmelt, blocked storm drains, burst pipes, construction runoff, flash floods, heavy rain, tornadoes and hurricanes. Your chances of water damage are real even if you live miles from a river, lake or coast.
Standard homeowners insurance is not a substitute for a separate flood policy.
5. Your entire property may not be at risk
Flood designations apply to specific areas, not necessarily to an entire lot. Check FEMA's flood maps to see whether the flood zone covers the whole property or just a portion of it. If only a corner of the lot is in a flood zone and the home itself is not, that can affect the cost of your insurance and possibly whether it is required at all.
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6. Flood insurance may be mandatory
You may be comfortable accepting the risk and skipping flood insurance, but the federal government may not give you the choice. Under federal law, flood insurance is required for all federal or federally related financial assistance for the acquisition or construction of buildings in high-risk flood areas, known as Special Flood Hazard Areas, or SFHAs.
- If the property is in an SFHA, flood insurance is mandatory for any federally backed mortgage.
- If the property is in a low-to-moderate risk area, federal law does not require flood insurance, though your lender still may.
Check with your mortgage company before assuming you can opt out.
7. Know the numbers
The financial risks of flooding are significant, according to FEMA:
- Most claims do not come from high-risk zones. Properties in moderate to low-risk areas made up 29% of all flood insurance from 2014 to 2024, according to FEMA.
- During the past 20 years, 99% of counties experienced a flood event, FEMA said.
- The average payment for all claims from 2020 to 2024 was $82,614, according to FEMA.
8. Water damage is not the only cost
Flooding does more than damage walls and floors. A serious flood can displace your family for weeks or months while repairs are completed. Vehicles, pets, livestock and other property can be damaged or destroyed. Mold and other long-term complications are common in homes that have been flooded, and remediation adds to the total cost.
Before you buy, do the homework:
- Understand the flood zone designation for the property.
- Get flood insurance quotes and factor them into your monthly budget.
- Review your homeowners policy to confirm what is and is not covered.
- Have a plan for where your family would live if the home were temporarily uninhabitable.