What Your Homeowners Policy Misses on the Water

Picture this: It is a July afternoon, the pontoon is out on the lake, and a guest slips on the deck and is seriously injured. The resulting medical bills and liability claim far exceed your homeowners insurance limits. Your insurer reviews the claim and informs you that your vessel was specifically excluded from coverage at the time of the incident.

This scenario is more common than most boat owners realize, and July is exactly when it tends to happen. Peak boating season in the US brings millions of recreational vessels onto lakes, rivers, and coastal waters and most of those owners are on the water with significant coverage gaps they have never been told about.

What Your Homeowners Policy Actually Covers on the Water

Most standard homeowners policies include some watercraft coverage with limits that were designed for a very specific kind of boat. Typical coverage applies to small, low-powered vessels: canoes, kayaks, or motorboats with engines under 25 horsepower. Physical damage coverage often caps at $1,500, and liability coverage may be limited or excluded entirely once a motorized vessel is involved.

According to the U.S. Coast Guard’s most recent Recreational Boating Statistics, there are more than 12 million registered recreational vessels in the United States, with documented accidents resulting in hundreds of fatalities and thousands of injuries each year. The majority of incidents that generate significant liability claims involve motorized vessels — exactly the category most homeowners policies are not built to cover.

If you own a pontoon boat, a bowrider, a jet ski, a sailboat over 26 feet, or any vessel with a higher-horsepower engine, there is a strong chance your homeowners policy will not respond meaningfully to a serious claim on the water.

What a Standalone Watercraft Policy Covers

A dedicated watercraft insurance policy is designed for how boats are actually used. Coverage typically includes physical damage to the vessel from collision, theft, sinking, fire, and vandalism. Medical payments cover injuries to passengers and other parties. Liability coverage addresses bodily injury and property damage caused by your vessel. Uninsured boater coverage protects you when an accident involves another vessel owner who carries no insurance.

Coverage terms vary significantly by vessel type. High-performance powerboats, yachts, and large sailboats may require specialty marine policies. Jet skis and personal watercraft are often written on separate policies given their higher accident rates. One critical distinction: agreed value vs. actual cash value. Agreed value policies pay the full insured amount after a total loss with no depreciation applied. Actual cash value policies depreciate the boat before calculating the payout — a distinction that matters significantly on older vessels.

The Liability Exposure Most Boat Owners Are Missing

Physical damage to the vessel is one concern. Liability is what most owners underestimate.

A serious boating accident can generate claims that rival major auto accidents — involving medical costs, lost wages, and pain and suffering awards. Standard homeowners liability, even where it technically applies, is rarely sufficient for a serious on-water incident. Pairing a watercraft policy with a personal umbrella adds a critical layer of protection that every boat-owning household should consider before the season gets fully underway.

A coverage review that examines your vessel type, how and where it is used, who operates it, and where it is stored can identify gaps in your current program before July gives you a reason to find them on your own.

Ready to make sure your time on the water is actually covered? The team at Tooher-Ferraris has been helping families protect what they enjoy most since 1932. Contact us today to schedule a no-obligation consultation.

Personal Lines

August 5, 2026

Your Homeowners Policy Probably Does Not Cover Flood Damage. Here Is What to Know Before Storm Season Peaks.

August marks the beginning of the most active stretch of the Atlantic hurricane season. According to the National Hurricane Center, the peak of the season falls between mid-August and mid-October. This is a practical time for homeowners anywhere in the country to confirm exactly what their coverage includes for water damage caused by storms.

Does Homeowners Insurance Cover Flood Damage?

No. Standard homeowners insurance explicitly excludes flood damage. This exclusion applies universally, regardless of what causes the flooding, whether it is storm surge from a hurricane, overland flooding from a river, or rainwater that accumulates because a stormwater system is overwhelmed. It is not a fine-print technicality unique to certain carriers. It is a structural feature of how homeowners insurance works in the United States.

The reason for the exclusion is actuarial. Flood losses are geographically concentrated and can affect thousands of homes simultaneously in a single event, which creates a fundamentally different risk profile from the individual, unpredictable losses that homeowners insurance is priced to cover.

When Hurricane Helene brought catastrophic flooding to parts of North Carolina in late 2024, thousands of homeowners discovered that their policies did not cover the damage. The losses ran into the billions, and the majority were uninsured. That outcome follows a consistent pattern after nearly every major US flood event.

According to the Insurance Information Institute, only about 4 percent of US homeowners carry flood insurance. That figure is low even in areas near the coast or inside designated high-risk flood zones, and it is far lower in inland areas where flood exposure is less obvious.

What Is Flood Insurance and How Does It Work?

Flood insurance is a standalone policy that specifically covers losses caused by flooding. In the United States, it is available through two channels.

The National Flood Insurance Program is administered by FEMA and provides federally backed flood coverage to homeowners in participating communities. NFIP policies are sold through participating private insurance carriers and feature standard coverage limits and terms set by the federal program. NFIP coverage for a structure is capped at $250,000, and personal property coverage caps at $100,000 and must be purchased separately.

Private flood insurance is available from a growing number of carriers and can in some cases offer higher limits, broader terms, or different pricing than NFIP policies. According to industry data, private residential flood policies have been expanding at approximately 20 percent annually as more carriers enter the market.

A standard flood insurance policy covers structural damage to the home, including the foundation, electrical and plumbing systems, heating and cooling equipment, and built-in appliances. Personal property and contents coverage is a separate component. Flood policies do not cover outdoor property, vehicles, landscaping, or business interruption losses.

The most practical distinction to understand is this: homeowners insurance covers water damage that originates inside the home, such as a burst pipe. Flood insurance covers water that originates outside and enters the home at ground level. The source and entry point of the water determine which policy responds, which is why both types of coverage can be relevant after a single storm event.

Tooher-Ferraris offers flood insurance through both the NFIP and private market carriers. Homeowners can get a flood insurance quote or review coverage options directly through our website.

Who Needs Flood Insurance?

Homeowners in federally designated Special Flood Hazard Areas (high-risk flood zones labeled Zone A or Zone V on FEMA flood maps) are typically required by mortgage lenders to carry flood insurance. This requirement applies when the mortgage is federally backed.

The requirement represents a floor, not a ceiling. According to FEMA, more than 20 percent of all flood claims nationally come from properties located outside designated high-risk flood zones. Properties in moderate-risk zones, inland properties near rivers or low-lying areas, and properties in areas with aging stormwater infrastructure can all face meaningful flood exposure that the flood zone designation does not fully reflect.

A home insurance review that specifically examines flood exposure provides the information needed to make a considered decision. For a broader overview of personal coverage options, visit the personal insurance section of our website.

Real estate buyers and their agents are also increasingly navigating flood insurance questions earlier in the transaction process.

Our Insight on why buyers are asking insurance questions before making offers covers the flood zone disclosure conversation from the real estate professional’s perspective.

Frequently Asked Questions About Flood Insurance

Frequently Asked Questions
Does homeowners insurance cover flooding from a hurricane?	No. Standard homeowners insurance covers wind damage from a hurricane but excludes flooding. If a hurricane causes both wind damage and flood damage to the same property, two separate policies are needed to address both types of loss.
How long does flood insurance take to take effect?	NFIP policies typically have a 30-day waiting period before coverage becomes effective. Private flood insurance waiting periods vary by carrier. Coverage purchased after a named storm has formed generally does not take effect before that storm arrives.
Is flood insurance required if I live outside a flood zone?	It is not required by lenders for properties outside designated high-risk flood zones, but it may still be worth considering. More than 20 percent of flood claims come from properties outside those designated zones.
How much does flood insurance cost?	Cost depends on the property’s location, elevation, structure type, and the coverage amounts selected. The best way to determine cost for a specific property is to request a quote through Tooher-Ferraris.
Does flood insurance cover my car?	No. Flood damage to a vehicle is covered under the comprehensive component of an auto insurance policy, not under flood insurance. Flood insurance covers the structure and contents of the home.

Ready to review whether flood insurance belongs in your coverage program? The team at Tooher-Ferraris has been helping homeowners build complete protection programs since 1932. Contact us today or visit our flood insurance page to schedule a no-obligation consultation.

Business Insurance

August 4, 2026

Why Contractors Are Taking a Closer Look at Their Umbrella Limits in 2026

Most contractors establish their liability coverage limits when they first set up their insurance program and revisit them at renewal primarily as a cost exercise rather than a coverage adequacy review. That approach worked reasonably well when the liability environment was more stable. In 2026, more contractors are pausing to ask whether their current umbrella limits still reflect the projects they are pursuing and the legal climate they are operating in.

This is not an emergency situation. It is a routine program review conversation that has become more relevant as commercial liability claim severity has increased across industries over the past several years. Contractors who have not formally reviewed their umbrella program in two or three years are finding it a worthwhile exercise to confirm the coverage structure still aligns with their current risk profile.

What Has Changed in the Liability Environment

Commercial liability losses in the United States have been rising. According to Swiss Re, US commercial liability losses reached $143 billion in 2023, reflecting the combined impact of rising medical costs, increased litigation activity, and higher jury awards across multiple lines of business. Construction is among the industries most closely affected because construction work involves physical activity, multiple parties on shared job sites, and contractual relationships that can draw contractors into claims they did not initially anticipate.

According to Construction Executive’s 2026 industry outlook, excess and umbrella liability rates for construction accounts are projected to increase by as much as 15 percent in 2026. This pricing reflects how carriers are assessing the underlying exposure across the industry, and it is a practical signal that reviewing umbrella limits as part of the renewal conversation is time well spent.

It is worth noting that the commercial general liability market for construction remains largely stable and competitive. The umbrella layer is where the market has become more focused on underwriting discipline, and that is where most contractors benefit from taking a closer look.

What Umbrella Insurance Does for Contractors

Umbrella insurance provides an additional layer of liability protection above the limits of a contractor’s general liability, commercial auto, and workers’ compensation policies. When a claim exhausts the limits of one of those underlying policies, the umbrella steps in to cover the remaining loss up to the umbrella’s own limits.

For most contractors, the umbrella program is what determines how much financial exposure remains on the business side after insurance responds to a serious incident. A general liability policy with $1 million per occurrence coverage handles the large majority of routine claims. For a significant injury that involves extended medical treatment, lost wages, and extended legal fees, the umbrella is what provides coverage above the primary layer.

The umbrella also plays a practical role in contract qualification. Project owners and general contractors increasingly specify minimum umbrella limits as a condition of bid eligibility. A contractor whose umbrella limits fall below what a project requires may find themselves effectively disqualified from certain work, regardless of their qualifications or track record.

How to Think About the Right Limits for Your Operation

Determining appropriate umbrella limits is not a single formula that applies to every contractor. Several factors shape how an individual firm should calibrate their program.

The nature of the work is one consideration. Contractors performing work at heights, in confined spaces, or in environments with significant public exposure have different risk profiles than contractors working in controlled interior environments. The scale of projects matters as well. A contractor working on larger projects with more workers and more subcontractors on site has proportionally more complexity to manage and more opportunities for a significant incident to develop.

Contract requirements provide a practical starting point for establishing a floor. Reviewing the umbrella limits specified in current and anticipated contracts helps confirm whether the existing program meets the thresholds required to pursue the work the contractor wants to win. Many mid-size commercial projects now specify total liability coverage, including umbrella, in the range of $5 million to $10 million as a standard contract condition.

The annual renewal is the right moment to have this conversation. Reviewing the umbrella alongside the general liability and commercial auto policies as a single program gives a more complete picture than treating the umbrella as a fixed number that carries over automatically from year to year.

A commercial insurance program review that specifically addresses the umbrella layer is a practical step that most contractors can complete at their next renewal without significant disruption. For contractors who are also actively pursuing bonded work, discussing the umbrella program alongside the surety bond review gives a more complete picture of the overall risk transfer program.

Ready to confirm your umbrella coverage reflects your current operation? The team at Tooher-Ferraris has been helping contractors build appropriate insurance programs since 1932. Contact us today to schedule a no-obligation consultation.

Business Insurance

August 3, 2026

What Real Estate Brokers Get Wrong When Clients Ask About Insurance and How to Protect Yourself

It starts innocently. A buyer is walking through a house and asks, offhandedly, what insurance on a place like this would cost. The agent gives a rough number. The buyer uses that number in their budget. The actual quote comes in 40 percent higher. The buyer closes anyway, but now the monthly payment is uncomfortable, the relationship is strained, and if anything goes wrong downstream, there is a paper trail connecting the agent’s estimate to the buyer’s decision.

That is how E&O claims in real estate often begin: not with a dramatic professional failure, but with a casual comment that crossed a line the agent did not realize was there.

Insurance questions from buyers and sellers are coming earlier and more frequently than ever. In a homeowners insurance market defined by rising premiums, restricted carrier availability, and properties that are harder to insure than they appear, the gap between what a buyer expects and what insurance actually costs has never been wider. That gap is exactly where E&O exposure hides.

The Five Statements That Create Liability

Professional liability claims tied to insurance conversations in real estate typically involve one of five categories of misstatement. Each one is common. Each one is avoidable.

“This house should be easy to insure.” Insurability depends on roof age and condition, the property’s claims history, proximity to fire stations, construction materials, and market-specific carrier appetite. None of these are visible from the showing. An agent who implies a property is straightforwardly insurable is making a professional representation that only a licensed insurance professional can make accurately.

“Insurance on a home like this usually runs around X per month.” Premium estimates are underwriting determinations. They vary by carrier, the buyer’s own claims history, the property’s specific characteristics, and coverage structure. A number cited by an agent, even a well-intentioned one based on their own prior policies, creates the impression of professional guidance it cannot back up.

“The roof should be fine.” Roof age and condition are among the top factors carriers use to determine both eligibility and premium. Stating that a roof “should be fine” for insurance purposes requires knowledge of carrier guidelines the agent does not have.

“You probably don’t need flood insurance here.” Flood zone designations can be complex, and whether flood insurance is required, recommended, or optional depends on FEMA flood map designations, lender requirements, and the buyer’s own risk tolerance. Agents who opine on flood insurance necessity are operating outside their scope.

“I wouldn’t worry about the claims history.” Prior claims on a property are visible to insurers through CLUE reports and affect both eligibility and pricing in ways buyers cannot fully anticipate without professional guidance.

What to Do Instead

The right practice for every one of these situations is the same: refer the buyer to a licensed insurance professional, do so early in the process, and document that you did. Five practices that reduce E&O exposure in insurance conversations: never estimate insurance costs; avoid characterizing any property as “fully insurable”; recommend buyers speak with a licensed insurance professional before making an offer on properties with potential insurability concerns; document insurance referral recommendations in writing; stay within the scope of the real estate license. Per the specialty programs coverage that protects brokerages, your E&O policy covers licensed real estate activities, not insurance advice.

Ready to connect your clients with an insurance partner who can support your transactions without creating risk? The team at Tooher-Ferraris has been helping real estate professionals and their clients since 1932. Contact us today to schedule a conversation.

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What Happens When Something Goes Wrong on the Water? Your Homeowners Policy Probably Won’t Help.