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Standard homeowners insurance covers many of the perils associated with severe weather. But the high risk of insuring coastal properties has prompted some insurers to limit or exclude coverage for hurricanes, windstorms, and flooding, or charge higher deductibles for damage from coastal weather events.
While not a distinct type of policy, coastal homeowners insurance fills those gaps with a collection of add-ons that coastal properties need because of elevated risks.
This guide explains how coastal home insurance works, what it covers, and ways to save on your premiums.
Coastal homes are expensive to insure because of the effects of rising sea levels and an increase in the number and severity of catastrophic storms.
Understanding the risks associated with your coastal location is key to selecting the right insurance policies for your home.
Review your coverage periodically and compare rates from multiple insurers to find the best deal.
Coastal home insurance isn’t one specific insurance policy. Instead, it consists of a standard homeowners policy, plus add-on coverage options for homes exposed to coastal risks like hurricanes and severe flooding.
For example, coastal home insurance may include an endorsement for hurricane-related wind damage or a separate windstorm insurance policy. And qualifying homeowners may also be eligible to purchase flood insurance through the National Flood Insurance Program (NFIP).[1]
Factors such as your proximity to the coastline, your home’s elevation compared to sea level, and proximity to flood zones affect coverage eligibility and pricing. In high-risk coastal areas where coastal insurance is difficult to get from private insurers, state-backed insurance plans, such as FAIR Plans and wind pools, can provide the coverage you need.[2]
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Coastal property insurance starts with standard homeowners coverage, but coverage options vary by insurer and location. Some standard home insurance policies also limit or exclude wind damage, so it’s important to read the fine print.
Here’s a closer look at what coastal home insurance covers:
Dwelling coverage pays to repair or rebuild your home after damage by a covered disaster.
Other structures coverage reimburses for damage to detached structures like garages and sheds within coverage limits.
Personal property coverage protects the contents of your home plus certain personal belongings stored outside the home.
Liability insurance pays legal fees and other costs if you’re responsible for someone else’s accidental injury or property damage.
Also known as loss of use, this coverage pays your living expenses if the covered damage to your home forces you to live elsewhere during repairs or rebuilding.
When paying out dwelling coverage claims, most homeowners policies pay either the actual cash value (ACV) or replacement cost for insured losses. ACV accounts for depreciation in your claims payout amount, while replacement cost pays you what it would cost to rebuild the physical structure of your home. But for coastal homes, standard replacement cost may not be enough.
Wind coverage from a homeowners policy reimburses you for damage resulting from high winds. But in coastal areas susceptible to severe weather, insurance companies often limit or exclude coverage for named storms by the National Hurricane Center.
Policyholders in affected states, like Florida, may have to purchase separate wind policies. Homeowners may also need to pay a special hurricane deductible when filing a wind damage claim after a hurricane or tropical storm.[3]
Storm surges and buildup from heavy rain are common causes of coastal flood-related losses. Standard homeowners insurance doesn’t cover flood damage regardless of the cause. If you live in a high-risk flood zone and have a government-backed mortgage, such as a Veterans Affairs (VA) or Federal Housing Administration (FHA) loan, your lender will require you to have it.
Flood insurance is available through NFIP, the government-backed flood insurance program managed by the Federal Emergency Management Agency (FEMA). Coverage options include the buildings on your coastal property, your personal belongings, or both.
Nearly 50 private insurance companies sell NFIP policies. Or buy one directly from the program page on the FEMA website.
Coastal home insurance generally excludes certain causes of damage from coverage:[4]
Flood damage: Homeowners insurance doesn’t cover floods. You’ll pay out of pocket for flood-related damage claims unless you have separate flood insurance.
Erosion and gradual shoreline loss: Coastal home insurance typically doesn’t cover damage from moving earth, like a landslide, sinkhole, or shoreline erosion.
Wear and tear from salt air: Salt corrodes metal, wood, and other materials over time. Because the damage is gradual rather than from a sudden, unexpected event, insurance doesn’t cover it.
Maintenance-related damage: Insurers typically exclude issues related to deferred maintenance, such as water damage from a leaky plumbing fixture or a worn roof.
Be sure to read your insurance policy carefully or contact your insurance agent if you have questions about your coverage. Otherwise, you might have to pay out of pocket for damage you thought was covered.
Coastal homes are susceptible to damage from many sources, including saltwater corrosion, wind, and storm surges from hurricanes and tropical storms. In fact, hurricanes and tropical storms were the second-leading cause of catastrophe insured losses from 1997 to 2016.
Coastal catastrophic losses are on the rise and could double every decade, according to the Insurance Information Institute.[5]
Continued development of increasingly expensive buildings is one reason for these escalating losses. Climate patterns, rising sea levels, and increases in the number and severity of storms are also to blame.
Insurers look at many factors to evaluate risk and set insurance rates. For coastal properties, risk factors include:
Your location’s susceptibility to hurricanes and tropical storms, based on historical storm data
Climate risk effects
The distance from your home to water
The cost to rebuild your home
Coastal home insurance costs vary widely, depending on the type of homeowners insurance coverage you choose, any add-on insurance you need, the insurance company, and other factors like location and property type. But flood insurance premiums are usually what drives up costs for coastal property owners since standard home insurance doesn’t cover floods.
FEMA flood insurance price data shows that 82% of policies cost $3,000 or less, while 37% cost $1,000 or less. So you could be paying thousands of extra dollars annually for flood coverage. By comparison, a standard homeowners policy costs around $2,868 per year, according to Insurify data.
Key pricing factors include:
Location and flood zone designation
Home elevation and distance from water
Year built and FEMA flood-rating factors
Coverage limits and deductibles
NFIP or private flood insurance
Fortunately, flood insurance premiums are relatively predictable compared to other coastal home insurance coverage, like windstorm protection. This is due in part to FEMA’s extensive flood-risk data available to insurers.
New York has more than 2,600 miles of shoreline, leaving many coastal properties vulnerable to wind and flood damage.
Insurify data shows that homeowners insurance for $300,000 in dwelling coverage costs around $111 per month in New York, which is less than half the national average. That coverage usually includes wind damage. But flood insurance adds a median cost of $1,834 per year.
Florida has more than 8,400 miles of shoreline, with more exposure to coastal storms than any state except Alaska.[6] Florida homeowners pay $6,060 per year for home insurance with $300,000 in dwelling coverage — more than double the national average.
Experts strongly encourage flood insurance for coastal homes. Mortgage lenders require it in some cases. The statewide median annual premium for flood insurance is $1,363.
Buying coastal home insurance usually involves more steps than purchasing standard homeowners coverage. Coastal insurance isn’t just one policy. Instead, it usually includes a combination of policies, like separate flood insurance and wind coverage, in addition to your homeowners policy.
Follow these steps to find the right coverage to protect your coastal home:
Assess your coastal risk. The National Hurricane Center has maps showing tropical cyclone risk, including from tropical storms and hurricanes, throughout the U.S.
Check private insurer availability first. Research local private insurers to find out if coastal coverage is available in your area.
Request wind and hurricane coverage details. Not all homeowners policies cover windstorm-related damage. Confirm coverage details and ask about separate wind or hurricane coverage for added protection.
Purchase separate flood insurance. Your lender may require flood insurance. NFIP flood insurance is available through private insurers or directly through the NFIP website.
Look into state-backed options. If you’re unable to find coverage from a private insurance agency, you may be eligible for a state-sponsored policy. Before choosing a policy, always compare quotes and coverage options to find the best coastal home insurance for your situation. Be sure to look carefully at deductibles and coverage limits.
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The threat of damage from severe weather makes your coastal primary or vacation home expensive to insure.
The following strategies can help to offset some of those additional costs:
Install wind-mitigation features, like wind-resistant attic vents or impact-resistant doors, windows, and roof coverings.
Elevate utilities and heating, ventilation, and air conditioning (HVAC) systems to keep them out of flood waters.
Compare private insurers and state-backed plans to find the best deals.
Bundle home and auto insurance to qualify for a multi-policy discount.
Raise deductibles to reduce your premiums.
Ask about discounts for any storm-mitigation equipment you install.
Review your insurance policies periodically to make sure you have the right amount of coverage for the potential effects of severe weather on your coastal home. Then, compare rates with similar policies from other insurers to find the best price.
Coastal home insurance is comprehensive coverage that goes beyond standard homeowners insurance. Understanding how coastal homeowners insurance works can help you find the best policy.
Possibly. You most likely need separate wind insurance if your homeowners policy excludes named-storm coverage and flood insurance if you’re in a vulnerable location or your lender requires it.
It can be. Both terms refer to a combination of policies and add-ons that cover wind and flooding from hurricanes and other coastal storms.
Yes. But your homeowners insurance won’t cover it, so you need to purchase separate flood insurance through FEMA or a private insurer.
Coastal homes are risky for insurance companies to insure. High deductibles reduce the risk by making policyholders responsible for paying part of their claims.
Insurify data scientists analyzed rates from more than 180 home insurance companies sourced directly from Insurify’s partner companies and Quadrant Information Services. Rates span all 50 states and Washington, D.C., and quote averages represent the mean price for a given coverage level and geographic area. To ensure data reliability, only insurers meeting minimum quote thresholds were included in the analysis.
Unless otherwise specified, quoted rates reflect the average cost for homeowners with no prior claims and good credit with a home construction year of 1980. The default coverage assumptions include:
Default Coverage Assumptions
Additional data points beyond these default values are sourced from Insurify’s proprietary database. Rates are updated monthly.
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Licensed Realtor with 10+ years in personal finance content
Contributor to Nasdaq and USA Today
Featured in
Licensed auto and home insurance agent
4+ years experience in insurance and personal finance editing
NPN: 20564519
Featured in
Licensed property and casualty insurance agent
10+ years editing experience
NPN: 20461358
Featured in
Data expert on auto trends and driver behavior
University of Chicago graduate with statistics degree
Featured in
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