Look online or talk to an agent to understand what is and isn't covered by the policy. Various options are summarized below.

Home insurance policies

These cover damage caused by household appliances, burst pipes, or rain entering the house from above (e.g., through a window). They exclude damage from flooding, backup through sewers and drains, sump pump failures, below-ground water that seeps into a basement, and mold damage. Home insurance policies also exclude damage from ‘earth movement’—the sinking, rising, shifting, and expanding or contracting of earth.

Homeowner rider policies

Most private insurance companies offer add-on ‘rider’ policies to your home insurance. Water backup and sump pump discharge policies can usually be purchased as such add-ons. They cover clean-up and repair costs of damage to personal property that occurs from water backing up through plumbing fixtures or from the failure of your sump pump. Water backup policies do not cover damage from water seepage through basement walls or from homeowner negligence.

The National Flood Insurance Program (NFIP)

If your property is at risk of flooding, you need coverage from the NFIP, which is administered by the Federal Emergency Management Agency (FEMA) and is available whether or not you are in the floodplain (provided that your municipality or county is participating in the program). The insurance is federally backed and covers damage to appliances, plumbing, furnaces, hot water heaters, and other structural items such as drywall, stairways, and insulation.

The policy excludes possessions kept in the flooded area, minus a few exceptions like air conditioners, clothes washers and dryers, and food freezers and their contents. The NFIP does not cover sewer backups, as it only covers seepage resulting from large, overland flood events.