Ian was a warning to make flood insurance accessible to all

You’ve seen the devastating images: homeowners wading through flooded living rooms or clinging to rooftops; streets turned into rushing rivers. As Hurricane Ian slashed across Florida last week, it brought record-breaking floods to many areas of western Florida.

In the era of climate change, record-breaking is the new normal. Ian came just two weeks after Hurricane Fiona hit Puerto Rico, subjecting residents to yet another damaging storm. Hurricanes are now hitting the U.S. with increasing frequency and intensity. Troublingly, recoveries are long, hard, and inequitable; policy reform is needed in the face of our escalating risks. 

One important place to start is financing recovery. Floods and hurricanes impose huge costs on households. Federal disaster relief is insufficient and can be slow in coming. Most residents don’t have sufficient savings to cover their losses. This is why insurance can be so critical to recovery, and yet far too many of those now picking through the rubble of their homes lack flood insurance to replace what they’ve lost. Without a national plan to make flood insurance affordable and accessible, many more will continue to struggle after these storms.

There is no such thing as hurricane insurance in the United States. More than 85 percent of homeowners have property insurance, which covers wind damage, but only a much smaller percentage are insured against floods. Floods are not included in a standard homeowners or renters policy; households must buy a separate flood policy to cover storm surges, river flooding, or flooding from heavy rain. This is confusing and costly. While some private firms offer flood insurance, the majority is sold by the federal National Flood Insurance Program (NFIP). 

To ensure those at higher risk have financial protection from floods, Congress mandates those with a mortgage from a federally backed or regulated lender who are located in high-risk areas, as mapped by the Federal Emergency Management Agency (FEMA), purchase flood insurance. For everyone else, flood insurance is voluntary, and those not subject to the mandate often don’t buy it. But that doesn’t mean they are safe from floods: for example, Ian dumped vast amounts of rain across central Florida, inundating communities where hardly anyone has flood insurance. The FEMA maps can be out of date, don’t include climate changes, and often fail to include areas at risk of flooding from heavy rain.

Indeed, in the nine Florida counties that have just been declared disaster areas, only 29 percent of households have federal flood insurance, according to POLITICO’s E&E News. In Hardee County, where nearly one in five residents live below the poverty line, just 1.3 percent of households are insured against flooding. This highlights that those who often need flood insurance the most are the least able to afford it — and so they go without coverage.

This is one contributing factor to the robust research finding that lower-income communities and communities of color suffer disproportionally from disasters. To begin to address this problem with floods, a policy consensus has emerged around the need for a public program of means-tested assistance for flood insurance. Many groups, including FEMA, have put forward policy proposals for how to design such a program to ensure that those in need have the financial protection insurance provides.

Such an assistance program could be tiered, offering increasing amounts of assistance as income declines. It could be designed to build on existing programs and use simple qualifying criteria to reduce burdens in administration, particularly on participants. It should be available to any household in need, and not just those in FEMA-mapped areas since those maps fail to identify all areas at risk of flooding, particularly as climate change advances. The program should be coupled with expedited grant assistance to reduce risks for these households through mitigation and buyouts in order to make them safer and lower their insurance costs.

By making flood insurance more affordable, the subsidy would protect families from losing everything in the next flood. It would also provide broader social benefits since economies recover more quickly as more residents are insured. And coupled with investments in risk reduction, it could lower future losses.

Proposals for a flood insurance affordability program enjoy rare bipartisan support. After all, disasters do not discriminate between red and blue states. To date, however, Congress has yet to adopt such a proposal. This administration is taking laudable steps to improve equity in our disaster programs and helping those most in need afford flood coverage would be a critical puzzle piece to improving climate resilience. 

Now, in the aftermath of yet another devastating flood, it’s time for Congress to launch such a program. In a warming world, we are certain to experience more storm surges, heavier rainfall, and rising seas. But, by expanding access to flood insurance, we can protect more Americans — especially the most vulnerable — and improve their financial resilience in the face of escalating climate-related disasters.

Carolyn Kousky is associate vice president for economics and policy at Environmental Defense Fund and author of “Understanding Disaster Insurance: new Tools for a More Resilient Future.”