Flood: Understanding and Recovering from One of Nature's Worst Disasters



“Many exclusions apply to basements unless there is a walkout door.”

Basic Insurance Limits

...interruption losses. Losses from mudflow and land subsidence that result from erosion that is specifically covered under the definition of flood, are covered. (Please see definition of flood on page 2.)


Basements are the most misunderstood areas when adjusting flood losses. A basement is defined as “any area of the building, including any sunken room or sunken portion of a room, having its floor subgrade (below ground level) on all sides.” However, if a room is subgrade on three sides, and has at least one walkout door (a door opening onto dry land where the ground is lower than the finished floor of the subgrade room), the room is not considered a basement. Many exclusions apply to basements unless there is a walkout door.

Property covered in a basement:

Property not covered in a basement:

NFIP will not cover anything below the Base Flood Elevation (BFE). The BFE is determined by FEMA and represented on contour maps that are very hard for most people, including adjusters, to understand.

Garden-Style Apartments

Garden-style apartments and their “basement” units present a unique problem in flood adjusting. There are thousands of these apartments in the country, and they are usually comprised of two levels; however, often the first floor is several feet below ground. Unfortunately, unless there is a walkout door, the bottom level is considered a basement and many items are not covered by flood insurance. In certain instances, when a flood strikes such apartments, determining what is covered and what is not can be tricky.

For example, in 1996 a widespread flood devastated Grand Forks, North Dakota, when the Red River overflowed its banks. Water levels reached up to six feet or higher on city streets, and roughly half the...