Taxes & Insurance
How do I know if a house will stay insurable — and affordable to insure?
The short answer
Insurability has become a make-or-break part of buying in 2026, because a home you cannot insure is a home you usually cannot finance. Two things to check before you commit: whether standard homeowners coverage is available and at what price in that area, and whether the home faces a peril standard policies exclude — most importantly flood, which is never covered by a normal homeowners policy and requires separate NFIP or private flood insurance. In high-risk states, insurers have been non-renewing policies or leaving markets, pushing buyers to state “FAIR plan” insurers of last resort, so it is worth getting a real quote — and a flood determination — early, not at closing.
Key points
- A home you can’t insure is usually a home you can’t finance.
- Standard homeowners policies never cover flood — that’s a separate policy.
- In high-risk states, availability itself (not just price) can be the problem.
- Get a real insurance quote and a flood determination early, not at closing.
Flood is the big exclusion
Flooding is the most common and costly U.S. natural disaster, and it is excluded from standard homeowners insurance. Coverage comes from the federal National Flood Insurance Program or private flood insurers, and if the home is in a mapped high-risk flood zone with a federally backed mortgage, flood insurance is typically required. You can check a property’s flood zone on the FEMA Flood Map Service Center, and see which states carry the most flood claims on our flood-by-state data page.
Availability, not just price
In states with heavy wildfire or coastal exposure, some insurers have stopped writing new policies or declined to renew existing ones, leaving buyers to state-backed FAIR plans that can cost more and cover less. Because a lender requires insurance to close, an availability problem discovered late can derail a purchase. Getting a bindable quote during your inspection period turns a closing-day surprise into a decision you make with time.
Common questions
- Is flood insurance included in my mortgage escrow?
- Only if you carry a flood policy — it is separate from standard homeowners insurance. If required, its premium is typically escrowed alongside your homeowners premium and property taxes.
Put this to work
Sources
Every claim above traces to a public government source.