The common assumption is that floods only happen near large bodies of water—oceans, lakes, or rivers. But the truth is this: every single home in America is located in a flood zone. Whether your property is in a high-risk FEMA AE zone or a so-called “low-risk” X zone, the potential for flood damage exists—and the consequences of not being properly insured can be devastating.
💧 So what qualifies as a flood, and why isn’t it covered under your normal home insurance policy?
A flood, by insurance standards, is defined as an overflow of water onto normally dry land affecting at least two properties or two acres. That means something as seemingly routine as a sudden, intense rainstorm that overwhelms storm drains could be considered a flood if the water enters your home. And because this water comes from outside—not from within the home—it’s not covered by a standard homeowners policy. Damage from a burst pipe inside your house? Covered. Water pouring in through your foundation after a torrential downpour? Likely not covered—unless you have a separate flood insurance policy in place.
💬 Tim and Sean discuss:
Why insurance companies exclude flood coverage from basic homeowners policies
The difference between internal water damage (covered) and external flooding (excluded)
How FEMA flood maps categorize risk zones (like AE, X, and A zones)
Why banks require flood insurance when issuing mortgages in high-risk areas
The low cost and high value of flood coverage, especially in moderate-risk zones
What percentage of clients actually choose to add flood coverage voluntarily (and why that number should be higher)
The episode also explores how climate events are changing the game. Flash floods and extreme weather events are no longer rare, and properties in so-called “low-risk” areas are seeing damage from sudden rainfall, drainage backups, and soil saturation—all classified as flood-related losses. As the risk becomes more widespread, having the conversation with clients and consumers becomes even more important.
📊 You’ll also learn how Zillow has partnered with climate data firm First Street to display flood risk scores for individual properties—giving home buyers more transparency than ever before. While this innovation helps inform smarter decisions, it also raises questions: What happens when a “bad” score devalues a property? Could this lead to legal or financial pushback from sellers or developers?
🎧 This episode is packed with eye-opening insights for:
Real estate professionals trying to protect clients
Insurance agents looking to provide better education and risk mitigation
Homeowners who want to avoid massive out-of-pocket costs after a flood
Buyers who think “flood insurance isn’t something I need”
🏡 Whether you're investing in real estate, advising buyers, or just trying to protect your own home, this episode gives you the knowledge you need to navigate the hidden gaps in coverage and the growing impact of flood risk on American property owners.
🔔 Subscribe to Bricks and Risk for real talk about risk, insurance, and real estate—and be sure to hit the bell so you never miss a new episode.