Term Insurance Agency-Calif. Insurance License #0563687 Phone: 877-itsterm (877-487-8376) "Insurance Designed To Last A Lifetime"
Term Insurance Agency-Calif. Insurance License #0563687Phone: 877-itsterm (877-487-8376)"Insurance Designed To Last A Lifetime"

Flood Insurance

Buying flood insurance in drought stricken California doesn’t make much sense, does it? But, some mortgage lenders require a flood policy to get a loan.
Here is a recitation on flood insurance from a variety of online sources followed by an offer for you to take action and get a quote.
Flood insurance coverage in California
Flood insurance protects your home's structure and your belongings from damage resulting from a declared flood. NFIP flood insurance policies offer up to $250,000 in building property coverage and up to $100,000 in contents coverage.
NFIP flood insurance will cover your dwelling structure at replacement cost or actual cash value, while your belongings are covered at actual cash value. Replacement cost means that damages to your home will be repaired up to policy limits without depreciation being a factor. Actual cash value means your possessions will be replaced based on what they're worth after depreciation.
In order for your home to qualify for replacement cost coverage, the following criteria needs to be met:
The house is a single-family home.
You live in the house at least 80% of the year.
Your flood insurance dwelling coverage meets at least 80% of the replacement cost of your home, or the max amount available for the home under NFIP limits.
If your home does not meet these three criteria, your flood insurance will pay out dwelling claims at actual cash value.
Do I need flood insurance in California?
Every county in California has had a flood disaster declared more than once in the history of the state. The Central Valley frequently floods due to river overflow. Aging dams are a prime danger in California as well. There's also a high chance of flooding along the coast of California when high tides and large storms or tsunamis occur. In 2011, the 9.0 earthquake in the Tohoku region of Japan created tsunami currents that did over $100 million in damage to 27 harbors along California's coastline.
According to States at Risk, flooding in California will only get worse due to climate change, with an additional 200,000 people projected to be at risk of flooding due to sea level rise.
The best way to see what kind of flood risk your home is at is to check the FEMA flood map online for California.
Just because your neighborhood hasn't flooded yet doesn't mean it won't this year. Homes in low risk areas account for 25% of all flood claims. And in a high risk area, your chances of flooding during a 30-year mortgage are 1 in 4.
Flood Facts:
Homeowners insurance won't cover it. Only flood insurance covers the kind of damage caused by flooding.
Floods are expensive. Two inches of water could cause over $7,000 in damage. As the water rises, so do your costs.
Government assistance is rare. Only the President can declare a federal disaster and even then the aid offered is typically a loan to be repaid with interest.
Most policies need thirty days to take effect.
What is the National Flood Insurance Program?
The National Flood Insurance Program (NFIP) is administered through the Federal Emergency Management Agency (FEMA). The NFIP enables property owners in participating communities to purchase flood insurance from the national government. For several decades, the NFIP was the only option for flood insurance. Until recently, their pricing structure was confusing and complicated, overcharging half of its policyholders, while undercharging the other half.
Although California has an average flood premium that is higher than the national average, you can still take several steps to lower your premium.
Increase your deductible. Your premium and deductible have an inverse relationship. If you choose a high deductible, you can lower your premium.
Provide an Elevation Certificate. An Elevation Certificate provides information provides information on the location of your home, the lowest floor elevation, your home's building characteristics and its flood zone. You can submit the certificate to your insurance agent to find out if you can lower your premium.
Install flood openings and fill in the basement. You can lower your premium if you install flood openings on the walls of your basement.
What is Private Flood Insurance?
Private Flood Insurance is coverage that insures property against the peril of flood. It is funded and written by private insurance companies instead of the National Flood Insurance Program. It is becoming increasingly popular and is often a cheaper alternative to the NFIP. Additionally, private flood insurance typically offers higher limits and a wider array of coverage options than a comparable NFIP policy. Private Flood Insurance was not widely available until the year 2012. The NFIP does allow companies like Allstate and Farmers to sell a "Write Your Own" policy flood insurance but it is still an NFIP policy. Private flood insurance is a small but growing part of America’s flood insurance landscape. The NFIP’s total premiums added up to more than $3.5 billion in fiscal year 2021, according to Federal Emergency Management Agency data In comparison, private flood insurers accounted for just $302 million in premiums in 2020, the most recent year for which data is available, according to the Insurance Information Institute
But the NFIP’s massive market share doesn’t mean it’s the best option for everyone. For example, the program’s coverage limits top out at $250,000 for the structure of your home and $100,000 for your belongings. These amounts may not be enough if you have a large home or expensive belongings.
Compare those limits with the offerings of a private insurer like Neptune, which will cover your house up to $4 million and your belongings up to $500,000.
An NFIP policy won’t pay to repair a damaged swimming pool or replace items stored in your basement, nor will it cover the expense of living in a hotel or rental while your home is being repaired after a flood. But these types of coverage may be available from private flood insurance companies. Some private flood insurance policies are underwritten by surplus lines carriers. These are insurance companies that cover things standard insurers won’t. Surplus lines carriers are regulated and monitored to make sure they remain solvent. However, surplus lines carriers don’t need to pay into a state’s guaranty fund the way standard, or “admitted,” insurance companies do. A guaranty fund will pay policyholders’ claims if an admitted insurance company goes out of business. If you’re insured by a surplus lines carrier that goes under, you won’t have the same protection.
Pros of private flood insurance
Policies from private companies usually offer higher coverage limits than the NFIP maximums, and often a broader range of coverage.
There’s typically a shorter waiting period than the 30-day federal window.
Private flood insurance may be cheaper for some homeowners.
Cons of private flood insurance
If you drop NFIP insurance and buy private coverage, you may face a steep rate increase if you return to the NFIP.
Some private companies won’t insure all types of properties. Common restrictions include mobile homes, houseboats and properties that have recently flooded.

NFIP policies have the backing of the federal government, which could offer more security than a private company that could potentially go out of business.
Neptune Flood

Available in Washington, D.C., and every state except Alaska and Kentucky, Neptune offers a slick website where you can get a flood insurance quote within a few minutes. Neptune’s flood insurance covers items an NFIP policy won’t, including damage to items in your basement, swimming pool refills and additional living expenses if you need to stay in a hotel while your home is repaired.

Its coverage limits are also significantly higher than the NFIP’s: up to $4 million for your home’s structure and $500,000 for its contents. Coverage takes effect 10 days after you buy the policy — or immediately if you purchase it in conjunction with a mortgage.

Are You Insured For A Flood?


….probably not. How about mudflow or a landslide? Flood insurance may cover mudflow depending on the circumstances. Even a homeowner’s insurance policy could cover mudflow if the proximate cause was determined to be wildfire-a covered peril. A landslide is not covered under homeowner’s or flood insurance policies-for that peril you need DIC insurance (Difference In Circumstances). Here is flood insurance information gathered from several online sources.



FEB. 5, 2024 12:40 PM PT

“This week’s rain is turning streets into creeks and hillsides into mudslides. Homeowners across Southern California are facing major damage to their homes as a result — and in most cases, they won’t get any help cleaning up the mess from their insurance companies.


The standard homeowners’ policy does not cover losses from flood damage. Mudslides, mud flows and debris flows aren’t covered by typical homeowners’ insurance, either — though in particular circumstances, a homeowner’s policy might cover some of the damage from these events. Damage from falling trees or other wind-related impacts should be covered by homeowners’ policies, however, and the comprehensive coverage in an auto insurance policy should cover any damage to Californians’ cars.


Flood insurance has been underwritten by the federal government since 1968, as part of the National Flood Insurance Program. Homeowners have to purchase this coverage separately from the NFIP, which is administered by the Federal Emergency Management Agency, if they want their house to be protected from flood damage.


But Californians, by and large, haven’t ponied up for flood insurance. Out of the over 4.6 million flood policies in the country, 190,000 — just over 4% — are for California homes and businesses, according to data from the NFIP. In the eight Southern California counties under a state of emergency from the current storm, only 52,820 homes and businesses are covered.


Los Angeles County, home to nearly 10 million people, has just 14,580 flood insurance policies on the books.


The good news for policy-holders is that flood insurance covers most of the ways that dirt, water and debris can damage a home, as long as a major flood event is in progress.


Essentially, as long as mud or debris that damages the home is being carried by water, then flood insurance kicks in, said Janet Ruiz, director of strategic communication at the Insurance Information Institute, an industry group. The technical terms for these sources of destruction are mudflows and debris flows.



If a wildfire is involved in creating the mud or debris which then flows into a house, the fire coverage section of a typical homeowners’ policy can cover that damage. This kicked in during the deadly 2018 floods and mudflows in Montecito, which claimed 21 lives and led homeowners to file $388 million in insurance claims. Since the floods came on the heels of the massive Thomas fire in late 2017, that incident was deemed the “proximate cause” of the damage. But this specific set of circumstances is not common, and after a relatively sedate 2023 fire season, is unlikely to help many homeowners dealing with damage this week.


But mudslides — which have a technical definition distinct from the colloquial use of the word — are not covered by flood insurance, and are rarely covered by any kind of insurance policy at all. If water is picking up mud and debris and moving it into a home, that’s a mudflow in insurers’ books. But if the wet ground that a home is on slides away, shifting the house off its foundations (or causing it to fall off the side of a hill), then that’s a mudslide, and few policies will help the homeowner out.


“That’s ground movement, so that’s homes sliding off their foundation,” Ruiz said. “That’s not covered under a homeowners’ or flood insurance policy.”


The same goes for landslides, like the one that caused a cluster of houses in Rolling Hills Estates to pitch into a ravine in 2023.


But in a very specific scenario, a normal homeowners’ policy will cover some damage related to a mudslide or other earth movement: “If your neighbor’s house slides into yours, then their homeowners’ insurance would be liable to pay for your house,” Ruiz said.


Private insurers do offer flood coverage, and Ruiz said that it’s becoming more popular among the wealthy. The federal policy caps out at covering $250,000 in damage to a residential property and $100,000 for its contents. Even though flood losses are typically partial — Ruiz points out that California floods rarely affect the second stories of homes — some homeowners turn to the private market for more coverage.


Then there’s the basement issue. The NFIP does not cover most damage to basements, which pushes some homeowners to buy specific policies for their underground lairs. “There’s some pretty cool basements out there,” Ruiz said; ‘some people really trick them out.’”


Coverage for Flood, Mudflow, Mudslide, Debris Flow, Landslide, or Other Similar Event After a Wildfire

Fact Sheet

Homeowner Policies

In general, homeowner’s insurance policies (HO) issued in California, while worded slightly differently by various insurers, provide coverage for accidental physical loss to property as described in the policy subject to exclusions and limitations. Standard exclusions include: flood, earth movement, earthquake, landslide or mudflow, settling, cracking, shrinking, subsidence or sinkhole, erosion, sinking, rising, shifting, expanding or contracting of earth. However, most homeowner’s policies will cover an ensuing fire or explosion resulting from earth movement.

Frequently Asked Questions

Does my HO policy cover damages from flood, mudflow, mudslide, debris flow, landslide, or other similar events?

HO policies generally exclude damages caused by mudflow, mudslide, debris flow, landslide, or other similar events. However, it is important to read your particular policy to understand what is covered and what is excluded. (Note: See below, regarding “efficient proximate cause”. There may be possible coverage depending on the facts and cause of the loss.)

My home suffered a mudflow/mudslide/landslide/sinkhole loss in the areas near the recent wildfires. Is this covered under my HO policy?

There exists the concept of “efficient proximate cause”. It is possible that if the facts show that the wildfire (a covered peril) was the efficient proximate cause of the subsequent mudflow, mudslide, debris flow, landslide, or other similar events, then there may be coverage under the HO policy. You should first file a claim with your HO carrier. Should the claim be denied, the insurer must explain the reason for the denial and provide specific language on which the decision was based. If you wish to have the claim decision reviewed, you should file a Request for Assistance with this Department.

I don’t have a copy of my HO policy. What should I do?

Ask your insurance company or agent for a copy of the policy and all endorsements. The law requires your insurance company to provide this to you free of charge within 30 days of your request.

I have my HO policy but I don’t understand it. What should I do?

CDI can help you to understand your policy and coverages, if you have those documents available (in an in-person meeting). Otherwise, you should first contact your insurance company, agent or broker to get assistance understanding your coverages. If you are still unsure about your coverages or disagree with how the insurer is describing your coverages, you should file a Request for Assistance with CDI and one of our officers will assist you in understanding your coverages.

If I suffered damages from a mudflow/mudslide/landslide/sinkhole and my HO policy does not cover these damages, what should I do?

If the Local Assistance Center (LAC) is open in the area for your event, you should speak with local and state government officials to find out if there are any special financial assistance programs you may be eligible for. If the President declares a state of emergency, there may be financial help available from the Federal Emergency Management Agency (FEMA) or low interest loans from the Small Business Administration (SBA). Also, you may check with your lender or other financial lending institutions to explore the possibility of special programs that may be available.

I don’t think the mudflow, mudslide, debris flow, landslide, or other similar event was a result of natural causes. I believe my house should not have been built at this location as the earth is not stable. What can I do?

If you believe that the mudflow, mudslide, debris flow, landslide, or other similar event was caused as result of actions or negligence on the part of others, you should contact an attorney and discuss the possibility of legal recourse.

National Flood Insurance Program

The California Department of Insurance does not have jurisdiction over claim disputes under the National Flood Insurance Program. Flood insurance is a Federal program administered by the Federal Emergency Management Agency (FEMA). Consumers who have purchased an NFIP policy and have a loss, should report the loss immediately to the insurance agent or the insurance company administering the NFIP flood insurance to report the claim. Consumers requiring assistance can reach NFIP at 1-800-621-3362.

Under the National Flood Insurance Program (NFIP), coverage is provided for direct physical loss by or from a flood which is defined as “A general and temporary condition of partial or complete inundation of two or more acres (one of which is your property) of normally dry land area or of two or more properties from overflow of inland or tidal waters; unusual and rapid accumulation of runoff of surface waters from any source; mudflow, collapse or subsidence of land along the shore of a lake or similar body of water as a result of erosion or undermining caused by waves or currents of waters that result in a flood.”

Pertinent NFIP policy exclusions are:

  • Earth movement - even if the earth movement is caused by flood.
  • Earthquakes
  • Landslide
  • Land subsidence
  • Sinkholes
  • Destabilization or movement of land that results from accumulation of water in subsurface area, or gradual erosion. However, the policy will cover losses from mudflow and subsidence resulting from erosion caused by flood unless the cause of loss is caused by a flood, as defined in the policy, damages resulting from landslides and sinkholes are not covered under the NFIP.

Consumers whose claims have been denied by NFIP can contact FEMA to explore the appeal process.

Source: “California Department of Insurance Website.”


Difference in Conditions Insurance


Click here to see the California Department of Insurance List https://www.insurance.ca.gov/01-consumers/105-type/5-residential/carriersDICpolicies.cfm


At Aegis General, we provide the only true stand-alone

DIC insurance program in the market. This means you

don’t have to meet the typical underwriting criteria of a

full homeowner’s program. Our program was designed

from the ground-up to support DIC (Difference in

Conditions) policies. As a companion to a FAIR Plan or

equivalent policy, we support all occupancies and dwelling

values of up to $3,000,000. The coverage in an Aegis DIC

policy complements the fire and other perils provided by

a California FAIR Plan or equivalent policy. And, just like

all of our programs, the Aegis DIC program is available via

our real-time online quoting and policy issuance platform.

The Aegis DIC policy helps fill the coverage gaps that

exist between a FAIR Plan or similar policy and a typical

DP3, HO3, HO4, MHO or HO6 policy (yes, we support DIC

coverage for renters and condo owners as well!). What’s

more, the Aegis DIC program provides all the convenience

you expect from a standard homeowner’s program:

  • Burglar alarm and other discounts;
  • Customer loyalty credits at qualifying renewals;
  • Equipment breakdown coverage; and
  • Even a coverage unique to Aegis that reimburses for a mandatory wildfire evacuation if the FAIR Plan or equivalent policy provides no Loss of Use coverage.


  • The only true stand-alone DIC insurance program, designed from the ground-up as a new Difference in Conditions policy. The Aegis DIC program is available via our real-time online quoting and policy issuance platform.
  • All occupancies supported
  • Dwelling limits up to $3 million available
  • Personal liability limits up to $1,000,000
  • Complements the coverage provided by your client’s California FAIR Plan or equivalent policy
  • Evacuation Reimbursement coverage included for all primary homes
  • Equipment Breakdown coverage available
  • Numerous discounts and coverage options available

Individual product coverage, limitations and exclusions may vary by state. Not all products available in all states.


Term Insurance Agency is P&C licensed in California only. We do not write homeowner’s or DIC insurance coverage. However, click here to see Neptune online flood insurance services we offer in California only.


Use the link to see NFIP flood maps: https://www.fema.gov/flood-maps




Term Insurance Agency or Robert Coleman does not bind coverage or issue policies. Cost of elevation certificate and photo, if required by underwriting, are the responsibility of the applicant. Term Insurance Agency and Robert Coleman is licensed to transact flood insurance IN CALIFORNIA ONLY. We are not responsible for electronic communication or connection failures during the application, policy management or premium transactions you conduct with us, Neptune Flood or its insurance companies. We are not authorized to waive the waiting period, modify coverage, collect premiums or pay claims. Policies issued by Neptune Flood companies are not backed by FEMA or the NFIP. "We" refers to Term Insurance Agency and Robert Coleman.

Copyright Robert Coleman 2023

Contact Us Today!

Term Insurance Agency-Calif. Lic. #0563687
PO BOX 6945
CA 92863

Phone: 877 487 8376 877 487 8376

E-mail: getaquote@terminsuranceagency.com

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Term Insurance Agency, PO BOX 6945, Orange, CA 92863,Tel. 877-487-8376 (877-itsterm), FAX 714-439-0583, California Insurance License #0563687 "Insurance Designed To Last A Lifetime "