Flood Insurance — A Growing, but Unnoticed, Need

Flooding is becoming an increasing issue in the U.S. and too many people don’t know it.

ValuePenguin finds flooding to be the most common, and most expensive natural disaster. Sadly, 96.7% of homes in the U.S. do not have flood insurance. The company’s home insurance expert Divya Sangameshwar said in 2024, the average cost per home after a flood issue was about $34,000.

"Climate change continues to drive sea-level increases and make weather more extreme," Sangameshwar said. "As a result, flood-prone areas around the country are expected to grow by nearly half in just this century. Two years of back-to-back decreases in active flood insurance policies indicates that many homeowners aren’t fully aware of the growing risks of flooding.”

And unless a home is in a special flood hazard area, it is not required to have flood insurance.

"Sadly, this means many homeowners are putting themselves at significant financial risk from future flood damages — especially when just one inch of flood water can cause $25,000 in damage,” Sangameshwar added.

Here’s more from the report:

• Only 3.3% of homes in the U.S. — 4.7 million — are covered by flood insurance
• In 26 states that number is 1%
• 2024 saw declines in flood insurance coverage in 36 states
• The average claim in 2024 cost $33,906
• In 2024 just over 30% of the flood losses were from claims that were not in FEMA’s flood hazard areas (SFHA)

Sangameshwar said we usually associate flooding with coastal or low-lying areas. That’s not the case anymore.

"Even if flood insurance is only required for a small subsection of homeowners, low flood risk doesn’t mean zero flood risk,” she said. “And homeowners insurance and renters insurance don’t cover flooding.”

Source link: PropertyCasualty360.com — https://bit.ly/3Xr2tHg

Source link: Insurance Business America — https://bit.ly/3QIlYXZ