“Following heavy rains during the night, volcanic floods hit early morning at 2:00 am (1700 GMT),” national disaster mitigation agency spokesman Sutopo Purwo Nugroho said.
Two people were also injured as the floodwaters rampaged, damaging at least 20 homes in Ternate City in North Maluku province and forcing evacuations to government offices and schools, he added.
He said rescue workers were searching for five missing people.
The floods carried volcanic mud from Mount Gamalama, which forms the entire island of Ternate in the Maluku chain. It erupted and spewed a column of ash 2,000 metres (6,500 feet) into the air in December.
Two rivers on the eastern side of the volcano overflowed after heavy rains, carrying volcanic debris down to three residential areas in the town, Nugroho said.
The Indonesian archipelago has dozens of active volcanoes. The country’s most active volcano, Mount Merapi in central Java, killed more than 350 people in a series of violent eruptions in 2010.