In the wake of Hurricanes Helene and Milton, many homeowners are waking up to a nasty surprise when realizing their homeowners’ insurance policy doesn’t cover damage from flooding.
Both hurricanes have caused extensive floods in the affected states, and cities along the Florida Gulf Coast reported storm surge levels comparable to Hurricane Ian in 2022. In addition to killing roughly 150 people, the two hurricanes have caused approximately $100 billion in damages, with Helene costing $47 billion in and Milton expected to cost in excess of $50 billion.
Flooding is covered by the National Flood Insurance Program, or NFIP, which is paid with an entirely separate premium and overseen at the federal government level (full disclosure: This author is a licensed flood insurance adjuster and has handled NFIP claims in the past). The Guardian reported that after Hurricane Helene slammed into the Southeastern United States, less than 1% of homeowners in some of the hardest-hit areas had NFIP policies. That group includes Asheville, North Carolina, where just 0.9% of homeowners have flood insurance. This means the vast bulk of flood victims will be left in the lurch.
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“Wind damage is covered typically by your standard home insurance policy, whereas flood in general is excluded,” Insurance Information Institute spokesperson Mark Friedlander told the Guardian. “For Hurricane Helene, many people filed claims with their property insurance. Those claims most likely will be denied because it is clearly a flood damage [claim], not a wind damage loss.”
For homeowners in high-risk flood zones (typically beginning with the letter A), flood insurance is usually required. However, data from the Federal Emergency Management Agency (FEMA) shows that four out of every 10 NFIP policies are in areas not defined as high-risk. FEMA regularly encourages Americans to buy flood insurance in advance of every hurricane season, which typically lasts from June through November.
“Floods represent the number one natural hazard threat facing our nation, destroying lives and causing billions of dollars in damage last year alone,” FEMA Administrator Deanne Criswell stated in 2023. “These threats, exacerbated by climate change, can be particularly devastating for underserved communities. As peak hurricane season approaches, we encourage all residents to recognize their risk and understand that in addition to wind and storm surge, rainfall and flooding from these events can be just as catastrophic.”
Florida has been hit by four major hurricanes — defined as Category 3 or above — in just the last two years. Ian and Helene were Category 4, and Idalia and Milton made landfall as Category 3 storms. But according to the Guardian, only 1% of Florida homeowners purchased flood insurance after Ian with 20% of homeowners having NFIP policies instead of 19%. This could be attributed not only to confusion over standard property insurance being separate from flood insurance, but also to what the publication described as the “soaring” cost of insurance, with homeowners’ policies costing roughly $7,000 annually. And that’s not including the additional several hundred dollars in premiums to be paid for an NFIP policy.
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In September, the Climate & Community Institute (CCI) published a study proposing new policy solutions aimed at strengthening insurance coverage for both homeowners and renters in flood-prone areas. One of those solutions is Housing Resilience Agencies, which would provide public disaster insurance and “coverage for oft-neglected sectors such as multi-family housing providers, mobile home dwellers, and heirs properties.”
“Almost 40% of people in the US are living in areas at high risk of property damage and destruction–including in the upper Plains and Southeast–and that risk is racialized,” the CCI stated on its website. “Communities of color, especially American Indians and Alaska Natives, disproportionately face multiple threats.”
The flood insurance crisis could be exacerbated depending on the outcome of the November election. Project 2025 — which was authored by roughly 140 of former President Donald Trump’s ex-staffers and advisors — would eliminate the NFIP and make steep cuts to FEMA. It’s unlikely private insurance would cover flood, given that the NFIP was created by Congress in 1968 because private insurers refused to pay for flood-related losses.
Click here to read the Guardian’s full report.
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