Few Americans have flood insurance despite widespread risks : NPR
A damaged house is seen after the sudden floods in Hunt, Texas, July 4. According to the Federal Emergency Management Agency, only 4% of the country owners have flood insurance.
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Ronaldo Schemidt / AFP via Getty Images
Almost all the counties of the United States have experienced floods in recent decades, but only 4% of owners at national level have insurance against floods, According to the Federal Emergency Management Agency.
This is what experts call the flood insurance gap. Most insurance owners does not cover floods. And while Fema Aid can be available to help people repair their houses after Declared FedernelleIt often covers a fraction of costs.
This means that when flood waters come, people are often alone to pick up the parts. It is a reality that communities across the country face after the floods are struck Texas,, New Mexico And North Carolina In the last week only. In the three states, the floods were caused by extremely strong precipitation inside the land – A risk that develops with climate change. A warmer atmosphere may contain more humidity. As temperatures increase, it feeds more intense rain storms that drop more water in shorter periods.
One solution: the owners, tenants And companies can buy flood insurance, that most people pass through fem National flood insurance programSaid Jeremy Porter, responsible for climatic implications at First Street, who assesses the property risks of climate change.
Federal flood insurance offers Up to $ 250,000 for houses and $ 500,000 for non -residential buildings. People can buy policies that also cover property Inside their house, including clothing and furniture. The program is open to all those who live in one of the About 22,600 communities who have adopted certain standards To regulate development in their floods. Porter estimates that people living in more than 90% of American counties are eligible. For people who want flood insurance but live outside an eligible community, they should go to the private market.
“It is clear that [flood] Insurance protects the owners and it protects communities, “said Porter.” He ends up preventing the drop in properties after the event. He ends up preventing the properties from entering foreclosure. “”
In some places, however, federal Flood insurance is unaffordable For many residents, and costs are increasing throughout the country.
So people “roll the dice, hope [a flood] This does not happen, “explains Brian O’Connell, analyst at Insurancequotes, an online platform where people can compare and buy insurance.” And when it happens – and we are talking to people to whom it happens – it is one of the worst things that people have ever experienced in their lives. “”
Strong rains from Hurricane Helene caused record floods and damage last year in Asheville, NC, because climate change increases global temperatures, it feeds more intense rain storms that drop more water in shorter periods.
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Some see the costs of flooding “that change life”
The US government created the National Flood Insurance Program in 1968 when private companies have ceased to offer coverage. The federal program, supported by taxpayers, was chronically indebted, borrow from the treasure To pay complaints.
Fema started several years ago Revision of the way in which the flood program fixes its prices. From now on, the premiums are based on the value of a house, known as FEMA, and the risk of flooding with which individual property is faced. It is a more granular approach that the government used before. FEMA says one of the objectives is to encourage actions that reduce flood risks.
Following these changes, the cost of federal flood insurance increases in certain parts of the United States in the parish of Louisiana plaque, for example, where 9 out of 10 houses are at risk of floodingpeople look Pay more than $ 5,400 per year For flood insurance, an average increase of more than 500%. This is aware of their regular home insurance costs.
“The guy with a house of a million dollars, he will understand,” said Anderson Baker, retirement insurance director in Louisiana. “The guy with a house of $ 150,000, a few hundred additional dollars per month, or $ 300 more per month, it is an increase that changes the life of his bonus.”
O’Connell of InsuranceCotes estimates that a flood insurance policy should cost around 30% to 75% of what someone already pays for home insurance. There are companies that have started to provide flood insurance, which creates competition for the federal program, explains Porter de First Street. However, private insurers cover only 12% of the market, according to First Street.
For some people, take on additional flood insurance costs It’s not really a choice. Houses in high -risk flooding areas that have government -supported lenders must have flood insurance. The properties that have received federal assistance on disasters in the past must also be covered by flood insurance to qualify for future assistance. And in FloridaThe insurer supported by the state of Last Resort, Citizens Property Insurance Corporation, began to demand owners who have coverage for damage caused by the wind to buy flood insurance.
If many more people bought flood insurance, this would lower the cost of coverage and could attract more private insurers on the market, explains Michelle Osborne, director of the Campbell University Management Institute.
But to the extent that things are, the cost of flood insurance is often a workplace for people, explains O’Connell insurance, especially since many doubts that they need protection.
“There is this misunderstanding that if I am not in a flood zone, then I should not have to obtain flood insurance,” said Baker, the retirement insurance director. “But everyone is in a flood zone. People at the top of a mountain are in a flood zone. They are just in a good flood zone.”
