Market & financial news desk
With Tropical Storm Bertha producing up to six inches of rain and isolated flash flooding across the northwestern Gulf Coast, a recurring problem is likely to surface in the days ahead: standard property insurance policies generally do not cover flood damage.
Wind Versus Water
The distinction that determines coverage is often wind versus water. Damage from wind-driven rain entering through a compromised roof may be covered under a standard policy, while rising water entering at ground level typically is not. That line can be contentious after a storm, and it is why documentation of how damage occurred matters so much.
Why Investors Get Caught
Investors are particularly exposed because the gap compounds: a flooded rental means both an uncovered repair bill and lost rental income simultaneously. An owner who assumed coverage existed can face a substantial unplanned cost against a property that has stopped producing.
Planning Around It
The straightforward fix is knowing your coverage before a storm and obtaining separate flood insurance where exposure warrants it. Where a gap does open up, investors sometimes finance repairs rather than let a property sit. If you want to think through how that would work on a specific property, our team is available to discuss it.