What does flood insurance primarily cover in terms of property?

Flood insurance specifically covers flood-related damage, which is defined as water damage that results from rising water, primarily from heavy rains, storms, or sudden water accumulation. This type of insurance is essential for homeowners and businesses located in areas that are prone to flooding, as it provides financial protection for repairs and rebuilding that standard homeowners' insurance typically does not cover.

The flood insurance policy is designed to address specific scenarios where water inundation leads to property damage, ensuring policyholders can recover from such events without incurring substantial losses. This coverage is distinct from other types of water damage, such as that caused by plumbing issues or other sources unrelated to flooding, which are typically handled by different types of insurance.

In contrast, the other answer choices either generalize the coverage to all types of water damage, which is incorrect, or imply exclusions that don't apply to flood insurance. Flood insurance focuses specifically on flood-related incidents, emphasizing the need for policyholders to understand their coverage limits and the specific risks applicable to their geographical areas.