Flood insurance
A separate policy covering flood damage. Required by lenders for homes in FEMA-designated flood zones. Available through the National Flood Insurance Program or a growing private market.
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Why a seller cares
If the home is in a mapped flood zone, the buyer's lender will require a flood policy, and the premium becomes part of what the buyer can afford. Your existing policy may be transferable, which can save the buyer money.
Part 2 of 4
A simple example
Your home is in a FEMA zone AE with a $1,900-a-year flood policy. The buyer's lender asks for coverage before closing, and your policy can be assigned to them.
| The situation | What follows |
|---|---|
| A mapped zone and an existing policy | The buyer can often take over your policy and its rate |
| A mapped zone and no policy | The buyer buys one; the quote can be a surprise |
| Outside the mapped zones | Optional, and cheap, and lenders do not ask |
In a flood zone, flood insurance is a loan condition. An assignable policy is a favor to the buyer.
Part 3 of 4
What people get wrong
That being outside the zone means no flood risk. It means no lender requirement; water does not read the map.
Part 4 of 4 · where to read next
Where it appears in the sale
What a definition is, and what it isn't
Keighbor is a software company, not a law firm, brokerage, or tax adviser. This is general information, not legal, tax, financial, or real estate advice about your sale. Your situation may differ. Before acting on a contract, disclosure, title, tax, or pricing question, ask an appropriately licensed professional in your state.
Written and researched by Keighbor Research · read against FEMA: flood maps · how we research and check what we publish
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