Flood insurance terms, explained
What these terms mean when they appear on flood insurance. Each definition describes the term itself, not what to do about it.
- Base flood elevation
- The height floodwater is expected to reach in a major flood. How your home sits relative to it affects your rates.
- Building coverage
- Flood coverage for the physical structure of your home and its built-in systems.
- Claim
- A request you make to your insurance company to pay for a covered loss.
- Contents coverage
- Flood coverage for your personal belongings. It is purchased separately from building coverage.
- Coverage
- A part of your policy that pays for a specific kind of loss, up to a limit.
- Deductible
- The amount you pay out of your own pocket on a claim before your insurance starts paying.
- Endorsement
- An add-on or change to your policy that adds, removes, or adjusts coverage. Also called a rider.
- Exclusion
- Something your policy specifically does not cover.
- Flood zone
- A FEMA map designation for an area flood risk. It affects your rates and whether a lender requires flood insurance.
- In force
- Active and providing coverage, because the policy is current and paid.
- Increased cost of compliance
- Extra flood coverage that helps pay to elevate, relocate, or demolish a repeatedly flooded building to meet floodplain rules.
- Insured
- A person or thing your policy protects.
- Liability
- Coverage that pays for injury or damage you are responsible for causing to someone else.
- Limit
- The most your policy will pay for a covered loss.
- Out-of-pocket
- Money you pay yourself, that your insurance does not cover.
- Policyholder
- The person who owns the insurance policy.
- The amount you pay for your insurance, usually each month or once a year.
- Sub-limit
- A smaller, separate cap inside a coverage that applies to certain items or losses.
- Sublimit
- A smaller, separate cap inside a coverage that applies to certain items or losses.
- Underwriting
- How an insurer decides whether to cover you and at what price, based on the risk.
Other policy types
These are general definitions. Your own policy is what governs your coverage, and the same term can be defined differently from one policy to the next. Read your own policy to see what these terms say in your document, cited to the page.