Homeowners Insurance: What Two Types of Damages Aren't Covered?

Ever flip through your home insurance policy and notice it feels like reading a different language? Here's something most people miss: standard homeowners insurance doesn’t cover damage from floods or earthquakes. If you've got visions of your policy swooping in after a downpour floods your basement or a tremor cracks your walls, think again—without special coverage, you’re on your own for those repairs.

This gap trips up tons of homeowners every year. Insurance companies have a good reason, but it doesn’t help much when you’re knee-deep in water or picking up fallen bricks. So, before you stash that policy in a drawer, it pays to check what’s missing. Knowing these common exclusions now could save you a fortune—and a lot of headaches—later.

• Big Exclusions: Flood and Earthquake Damage
• Why Insurers Say No to These Disasters
• Real-World Stories: When Coverage Falls Short
• How to Fill the Gaps in Your Home Insurance

Big Exclusions: Flood and Earthquake Damage

If you’re thinking your homeowners insurance handles anything Mother Nature throws your way, here’s a reality check: most policies flat-out deny claims for flood damage and earthquake damage. Yup, even a little water from a river overflowing or some cracks from a trembling ground won’t be covered. These aren’t rare one-off events either. In the U.S., floods are the most common natural disaster, according to FEMA, and earthquakes surprise people outside places like California more than you’d expect.

Why are flood damage and earthquake damage excluded? Insurance companies see these disasters as too costly and unpredictable. To give you some numbers, just one inch of water in your home can cause over $25,000 in damage. After big storms or seismic events, claims often hit billions—way more than insurers are willing to risk under standard policies.

Here’s what usually gets left uncovered by a basic homeowners insurance plan:

• Flooding from heavy rain, hurricanes, melting snow, and clogged storm drains
• Seepage of water into basements, even if it’s not a result of a specific storm
• Earthquakes causing cracks in walls, shifting foundations, or total collapses

To shed light on how serious these exclusions are, check out this quick data summary of recent disasters:

If you live anywhere near water or on shaky ground—even if you think it’s not a big risk—don’t assume your home insurance will pay up. It usually doesn’t, and a lot of shocked homeowners have learned this the hard way. The only way to truly protect yourself is with add-on policies like flood insurance from the National Flood Insurance Program, or earthquake insurance from private companies. Without these extras, you’re rolling the dice with your biggest investment—your home.

Why Insurers Say No to These Disasters

Here’s the deal: insurance companies avoid covering flood damage and earthquake damage because they’re too risky. These disasters can wipe out entire neighborhoods in one go, leading to losses in the billions. No single insurer can handle that kind of hit, and charging everyone sky-high premiums would make basic insurance unaffordable.

Let’s break it down a bit. Floods and earthquakes aren’t like house fires, which usually affect just one home at a time. When a hurricane causes major flooding or an earthquake strikes, hundreds or even thousands of homes can be damaged at once. That’s why these risks are called “catastrophic.” Insurers would need way more money in reserve than they could realistically keep just to pay out these claims.

To show you how rare homeowner flood and quake coverage is, check out this table:

Another reason insurers say no? Both floods and earthquakes are hard to predict and can cause wild swings in costs from year to year. It’s not just about the payouts—handling thousands of claims at once can bog down even the biggest companies.

If you live in an area where these disasters are more likely, your mortgage lender might still require special flood or earthquake insurance. But it won’t be part of your basic homeowners insurance package—you have to add it.

Real-World Stories: When Coverage Falls Short

You always think, "That'll never happen to me." But every year, thousands of people find out the hard way that their homeowners insurance excludes damage from floods and earthquakes. These aren’t just rare mishaps either—FEMA reports that over 20% of flood claims come from homes in low- or moderate-risk areas, places where a lot of people assume they have nothing to worry about.

Here’s a real example: In 2017, Hurricane Harvey dropped nearly 50 inches of rain on Houston. More than 200,000 homes flooded, but 80% of those homeowners didn’t have flood insurance. Since their regular homeowners insurance didn’t cover it, people paid out of pocket or relied on slow federal disaster aid. Many lost everything; some just walked away from their homes because repairs cost too much.

Earthquakes tell a similar story. After a big quake hit Napa, California in 2014, thousands dealt with cracked foundations, broken pipes, and ruined belongings. But only about 8% of homeowners in California actually had earthquake insurance. Most folks assumed their normal homeowners insurance would save the day, but they got stuck paying tens of thousands themselves.

If you’re thinking this only happens in certain states, think again. Floods don’t just hit coastal towns. They can happen in the Midwest and the Northeast when rivers overflow or storms hang overhead. Earthquakes aren’t just a California thing, either—they’ve rattled states like Oklahoma, Missouri, and even South Carolina.

Bottom line: most people only find out about these insurance exclusions after it’s too late. Double-check your policy now and ask your agent direct questions about what's not covered. You don't want to be the next "real-world story" featured in articles just like this.

How to Fill the Gaps in Your Home Insurance

If you just found out your homeowners insurance won’t save you from flood or earthquake messes, don’t panic. You can actually add extra protection, and it’s way simpler than most people think. Here’s how you plug those holes so you’re not left stuck when the next big storm or shake happens.

Flood Insurance: This isn’t standard—at all. You’ll need to buy a separate policy, usually through the National Flood Insurance Program (NFIP). Some private companies offer it too, but most folks stick with NFIP. If your mortgage lender tells you it’s required, don’t ignore them. Even if they don’t, floods can hit spots you wouldn’t expect—20% of flood claims come from low-risk areas.

• NFIP policies usually cover up to $250,000 for your home and $100,000 for stuff inside.
• Premiums start around $740 a year on average, but rates depend on how flood-prone your area is.
• There's usually a 30-day waiting period before flood insurance kicks in, so waiting until a storm is on the radar won’t work.

Earthquake Insurance: If you live in places famous for earthquakes, like California, you might already get mail about this. Standard home policies just don’t touch earthquake damage. Most big insurance companies will offer an earthquake policy as an add-on or a separate plan.

• Deductibles are high—sometimes 10-20% of your home’s coverage value—so repairs have to be pretty major for insurance to step in.
• Basic policies usually cover home repairs and your belongings, but extra options can deal with temporary places to stay or broken foundation work.
• California’s state-run market (the CEA) covers millions of homes statewide, but other states have their own options.

Curious what you’ll pay for flood or earthquake coverage in your zip code? Here’s a rough idea (actual numbers can swing a lot):

When you call your insurance agent, ask straight up if your current homeowners insurance covers floods or earthquakes (hint: it probably doesn’t). They can give you quotes and go over your options. Don’t forget—even if you rent, you can get renters flood or earthquake insurance.

Bottom line: A couple of add-ons or new policies could protect your savings and help you sleep better, especially if you live in a risk zone. Checking now is way cheaper (and less stressful) than wishing you had it after a disaster.