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Governor Pawlenty Signs Flood Insurance Disclosure Legislation

May 12, 2008

Governor Pawlenty Signs Flood Insurance Disclosure Legislation

FOR IMMEDIATE RELEASE:                                         
May 12, 2008                                                                                          
Contact:    Brian McClung
(651) 296-0001                      

Annual notice will provide information about flood insurance eligibility

Saint Paul - Governor Tim Pawlenty signed legislation (S.F. 2980) today that requires insurance companies and agents to annually notify homeowners if their insurance policy does not include flood coverage.  The required notice will also remind homeowners that they have the right to purchase flood insurance if they so choose.

Governor Pawlenty proposed the legislation on August 24, 2007 in response to the floods that hit southeastern Minnesota in 2007, where many homeowners were unaware that flood insurance was not included in their home insurance policy or believed that flood insurance was not available to them.

"During my visits to southeastern Minnesota last year, many homeowners were unclear about their flood insurance eligibility," Governor Pawlenty said. "This new law will help consumers by giving them more information about their insurance coverage options.  We are hopeful this will increase the number of homeowners purchasing flood insurance so that more Minnesotans will be covered the next time flooding hits our state."

The legislation requires written notice be provided to homeowners stating their policy does not include flood insurance and that they have the right to purchase flood insurance, provided their community participates in the National Flood Insurance Program (NFIP). Homeowners who live in a flood zone must purchase flood insurance from the NFIP.

General Information on Flood Insurance

  • The standard homeowners' insurance policy does NOT cover flood damage. Flood insurance is a special policy that is backed by the National Flood Insurance Program (NFIP). Check with your insurance company to see if they offer coverage. Check with area floodplain maps to figure out if your property falls on a 100-year floodplain, a 500-year floodplain or neither.

  • Floodplains are not the only areas at risk for flooding. Twenty to 25 percent of all Minnesota flood claims come from outside areas designated as high risk.

  • Flood insurance becomes effective 30 days after it is purchased. It is never a good idea to wait to purchase insurance until the last minute.

  • In the majority of floods, uninsured victims may have to use their own resources to rebuild or recover. Until the President declares a flood a disaster, disaster assistance is unavailable.

  • Nationally, less than 50 percent of all floods are declared disasters. Most disaster assistance is typically offered in the form of a loan which must be paid back.

  • The average flood insurance premium is $400 per year depending on where you live and the coverage you choose. In low to moderate risk areas, coverage can be purchased for just over $100.

  • Homeowners can buy up to $250,000 worth of structural coverage. Businesses can buy up to $500,000 of coverage. There is separate coverage for contents: up to $100,000 for residential and $500,000 for non-residential, so renters can purchase flood insurance too.

  •  Standard flood insurance does NOT typically cover basement improvements or personal contents in basements. It does, however, cover the structural elements and essential equipment normally located in basements, such as a furnace, water heater, washer and dryer. Talk to your insurance agent about specific coverage available for basements.  

Flood insurance is available in all communities that participate in the National Flood Insurance Program (NFIP). Most Minnesota communities participate. To find out if your community participates in the program, visit   
All claims and expenses of NFIP are funded by insurance premiums, not tax dollars.
For more information about flood insurance, contact the Federal Emergency Management Agency (FEMA), Federal Insurance Administration, Washington DC. 20472. You can also find information on the National Flood Insurance Programs website at  

If you have flood insurance and want information about filing claims, or if you are having trouble applying for flood insurance, call the national information line at 1-800-427-4661.

If you experience problems with an insurance company or are aware of any fraudulent activity, please contact the Minnesota Department of Commerce Consumer Response Team at 800-657-3602 or 651-296-2488 or visit us on the web at .