Contract of protection for damage caused by overflowing or rising water. Obtainable under Fire and Marine contracts as an incidental feature to a more comprehensive coverage. Straight Flood Insurance alone is a very rare coverage.
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US: Coverage against loss resulting from the flood peril, widely available at low cost under a program developed by the private industry and the federal government.
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Flood insurance is available from the federal government under the National Flood Insurance Program and is sold through licensed agents. Flood coverage is excluded under homeowners and most commercial property policies. Automobiles, however, are covered for flood under the comprehensive coverage section. Large commercial risks can often buy what is known as a “difference in conditions” policy that covers perils not covered in a standard property policy. Often this includes earthquake and flood coverage.
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Flood insurance, like earthquake coverage, is usually only of interest to those relatively few whose property is exposed. Consequently, losses among this small group will be high and premiums can be prohibitive. However, in 1968 the federal government stepped in to help property owners in designated flood plains with the National Flood Insurance Act of 1968. Coverage is not only available, but may even be required to obtain financing for exposed properties. Some private carriers are beginning to provide flood insurance.
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UK: Insurance against damage caused by the escape of water from the normal confines of any natural or artificial water course (other than water tanks, apparatus or pipes) or lake, reservoir, canal or dam in addition to inundation from the sea. Losses are normally subject to a minimum excess of £250. The risk is normally insured as an additional peril together with storm damage.
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MEDICAL,USA,REFERENCE: See: catastrophe insurance policy .