PhotoYou sometimes hear about homeowners being "underwater" -- meaning they owe more on their home than it's worth. But you can also be literally underwater, a prospect homeowners in parts of northern California are currently facing.

If the Lake Oroville Dam's spillway fails, as disaster officials fear it may, more than 100,000 homes could potentially be flooded.

“The potential for flooding poses a significant threat to life and property in these ... northern California counties and has forced the evacuation of tens of thousands of residents,” said Janet Ruiz, the Insurance Information Institute's California Representative. “Standard homeowners, renters and business insurance policies do not cover flood-caused damage. A separate flood insurance policy is needed.” 

Read that again: Standard homeowners and renters insurance does not cover flooding. 

Or as California Insurance Commissioner Dave Jones puts it: "Flood insurance may be all that stands between you and devastating financial losses. ... I urge homeowners to review their coverage needs and consider a flood insurance policy. Consumers need to know their risks and prepare before disaster strikes."

Federally-subsidized flood insurance is available from FEMA’s National Flood Insurance Program (NFIP) and a few private insurance companies. It's important to note that NFIP policies have a 30-day waiting period before the coverage is activated, so you can't wait until it starts raining to sign up. 

Excess flood insurance policies are also available from some private insurers if additional coverage is needed above and beyond the basic FEMA NFIP policy. To learn more about flood insurance, visit

What to do

Jones suggests consumers, including those in low-risk areas, assess their need to purchase coverage well before big storms hit. Even areas that have never experienced floods may be at risk after years of severe drought and devastating wildfires in California and elsewhere.
Jones also advises consumers to prepare for potential disaster by using their smartphone to record a home inventory to catalog their belongings and store them in their cloud account. Residents should also consider scanning deeds, insurance policies, and other important documents and store them in the cloud for easy access after the storm.

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