Standard homeowners’ policies make a distinction between water damage caused by plumbing problems and water-damaged roofs, and flood damage caused by rising waters. In almost all cases, the expenses from water damage are covered, while flood damage requires a flood insurance policy. If a pipe in your home bursts, the insurance company will usually cover the damage. On the other hand, if heavy rainfall causes a nearby lake to flood, your standard insurance policy will not cover any damage to your property. That’s why individuals in flood-prone areas are encouraged to purchase flood insurance for their homes.