Flood insurance is not automatically included under a business insurance policy. This coverage is administered by the National Flood Insurance Program (NFIP) and needs to be purchased as separate, additional coverage.
WHAT IS COVERED UNDER FLOOD INSURANCE?
Flood insurance covers two broad areas of loss. The first is to the physical building or structure, which includes damage to the foundation, walls, HVAC, wiring and more. The second form of coverage insures the contents including furniture, equipment, inventory and other items within the structure.
According to NFIP, the maximum commercial coverages are $500,000 for the building and $500,000 for the building contents.
HOW IS A FLOOD DEFINED?
The NFIP defines a flood as: “A general and temporary condition where two or more acres of normally dry land or two or more properties are inundated by water or mudflow.” While flooding more frequently occurs along rivers, lakes and streams, it also occurs in coastal areas. But as we've seen across the U.S., it also can occur as the result of a large amount of rain or snow, even to properties not in a flood zone.