What To Do if You Don’t Have Flood Insurance

Insurance is meant to protect you from unforeseen disasters, but what happens if your home is damaged by flooding following a hurricane and your house doesn’t have flood insurance?

The good news is you have options. Grants, loans, and other programs help cover some of the costs of repairing your home following a flood. So if you're wondering what to do if you don't have flood insurance, let's look at your options.

Check for Any Applicable Coverage

First, check your existing insurance policies carefully. Even if you don’t have flood insurance, your current coverage may help indirectly.

For example, your comprehensive auto insurance may cover the cost of repairs if the floods damage your vehicle. Similarly, your homeowners or renters insurance might reimburse you for additional living expenses you incur while evacuated from your home.

While this coverage won’t provide for all your needs, every little bit helps when facing damage caused by a flood.

Apply for FEMA Grants

For homes damaged or destroyed by a flood, the Federal Emergency Management Agency (FEMA) may offer grants to help with temporary housing and home repairs.

Who Qualifies for FEMA Grants?

FEMA opens up funding for disaster areas only when the president makes a disaster declaration based on feedback and requests by governors of the affected areas. If your home isn’t in the official disaster zone, you likely wouldn’t be eligible to apply for FEMA assistance. To find out if you’re in an official disaster area, check FEMA’s list of federally-recognized disaster areas.

If you live in a federally declared disaster area, FEMA provides financial assistance with:

• Temporary housing expenses and, in some cases, temporary housing
• Home repair or replacement
• Medical and dental expenses related to the disaster
• Money for rebuilding a home that is better-equipped to handle another flood
• Funeral and burial costs
• Child care

How To Apply for FEMA Assistance

Applying for FEMA assistance is a four-step process:

1. Document the damage from the disaster by taking photos.
2. Compile a list of damaged objects.
3. Make a claim with your insurance company. Since FEMA can’t cover benefits paid out by your insurance for damages, you have to determine what your insurance will and won’t cover before applying for FEMA grants.
4. Fill out the application and include proof of your occupancy in or ownership (mortgage payment, utility bill, lease, etc.) of the home along with your proof of ID.

You have three ways to fill out your application:

• Online: Navigate to the disaster assistance website and follow the step-by-step directions there
• Phone: Dial 800-621-3362
• In-person: Find your nearest FEMA Disaster Recovery Center by entering your zip code on the disaster assistance website

If you have to provide updates to your submitted application, you can fax them to 800-872-8112 (the fax should include “Attn: FEMA”) or mail them to:

FEMA

P.O. Box 10055

Hyattsville, MD 20782-8055

To check the status of your application, you can check it in the FEMA mobile app, at DisasterAssistance.gov, or call  800-621-3362. Creating an account also allows you to upload your documents and update your personal information.

Apply for SBA Disaster Loans

The Small Business Administration (SBA) provides low-interest disaster loans to businesses and homeowners. Disaster loans come in four types:

• Home repairs or replacement
• Personal property loss such as furniture, clothing, or vehicles
• Business repairs or replacement
• An economic injury such as lost revenues or increased expenses due to the disaster

These home and personal property loans feature low interest rates and long-term repayment options to make your recovery as easy as possible. You can apply for up to $200,000 to repair your primary home and up to $40,000 to replace personal property. SBA disaster loans have terms of up to 30 years.

Businesses have different lending limits and requirements. For example, in certain circumstances, businesses can apply for an economic injury disaster loan of up to $2 million.

Who Qualifies for an SBA Loan?

As with FEMA assistance, you must live in a declared disaster zone to apply. Renters can apply for personal property loans, while only homeowners can apply for funds to make repairs to their primary home. Secondary or rental homes are not eligible under this SBA program.

How To Apply for an SBA Loan

There are three steps to secure an SBA loan:

1. Register with FEMA: You can do so at FEMA’s Disaster Assistance website or by calling FEMA at 800-621-FEMA.
2. Apply for your loan: You can fill out your application online or by mail. Your application is reviewed by the SBA, who will assign you a loan officer who will gather additional information, review your insurance coverage, and discuss an appropriate loan amount. The SBA’s goal is to process your application in two to three weeks.
3. Review and sign your loan paperwork: If you agree to the terms and conditions, you can expect an initial disbursement of up to $25,000 within five business days. You’ll work with a case manager to schedule future allocations.

In certain cases, the SBA may increase your loan amount by up to 20% after closing to cover “unexpected repair costs” or get insurance proceeds for the damage.

Look for State or Local Options

The federal government isn't the only entity to provide financial assistance following a disaster. State and local governments often have programs to help residents with temporary living expenses, home repairs, or debris removal.

For example, the state of Florida and some counties provide resources to residents who don't have flood insurance and experienced damage during a declared disaster.

Not all programs offer the same benefits, so research what's available in your area before making any decisions. Use a search engine to search for "Disaster Relief" + "[your area]." This should pull up state and local agencies you can reach out to.

Contact Nonprofits

Numerous nonprofit organizations offer assistance following a disaster. These nonprofits are often more nimble than government agencies and can provide targeted help to those in need.

For example, the New Orleans-based nonprofit SBP has helped rebuild more than 2,200 disaster-damaged houses across the country. This group focuses on helping low- and moderate-income clients, prioritizing those with small children, the elderly, people with disabilities, and other underprivileged groups.

To help you find a legitimate charity or nonprofit rebuilding effort in your community, start your search on the National Voluntary Organizations Active in Disaster (NVOAD) website. This site includes a directory of more than 70 member organizations, all of which have histories of providing disaster-relief services. You can then navigate to an individual member's website to learn more about who it helps and where it currently is responding.

Watch Out for Scams

Disasters can bring out the worst in some people, including scammers who target vulnerable individuals. Be on the lookout for anyone who asks for money upfront or promises an unreasonable outcome. For example, if someone offers to have your home "completely rebuilt" in exchange for an upfront fee, this is likely a scam.

Additionally, be wary of people who come to your door unannounced and offer help with repairs. If you didn't request assistance, don't let them in your home or agree to do work with them. They may be unlicensed, uninsured, or unreputable. Stick to referrals from friends and insurance companies, and always verify business licenses by searching your state’s Department of Business and Professional Regulation, Office of Professions, or similar entity.

Also, not every nonprofit organization is legitimate. Before accepting help or handing over any money, do your research. The vetting provided at Charity Navigator is a good starting point, although some legitimate nonprofits may not be listed here.

Finally, remember that insurance scams also abound after a disaster. Ask for identification if someone calls or comes to your door claiming to be from your insurance company. If they can't provide any, don't engage with them further. It's always better to call your insurer directly to verify any information.

If you can’t tell if something is a scam or not, err on the side of caution and reach out to your local authorities or the Federal Trade Commission (FTC) for guidance. The FTC has an entire webpage dedicated to helping people avoid scams after disasters.

The Bottom Line

If you don't have flood insurance before disaster strikes, you may have other options. The best place to start is with FEMA. Its website lets you learn what programs you're eligible for and apply for assistance. You'll also need a FEMA account to apply for a disaster loan from the Small Business Administration. Other avenues for relief include nonprofit organizations and government agencies at the state or local level.

Read the fine print carefully before you sign any documents or pay anyone during this emotional time. That way, you know what you're getting into and avoid scams.

Frequently Asked Questions (FAQs)