New data shows that most Florida homes in the path of Hurricane Ian do not have flood insurance, making reconstruction efforts a major challenge.
In counties where residents have been evacuated, only 18.5% of homes are using the National Flood Insurance Program, said Milliman, an actuarial firm that works with the program.
Within these counties, Milliman found that homes within government-designated flood plains were the most exposed to flooding, with 47.3% of homes having flood insurance. Only an estimated 9.4% of homes have been flooded, although in areas outside the floodplain much of it is likely still damaged by rain and storm surges from Ian.
The low proportion of households with flood insurance illustrates the challenges posed by the country’s approach to post-disaster reconstruction. As climate change makes disasters more frequent and severe, the combination of public and private funding is being squeezed.
The economic impact of climate change on families and communities can be devastating if people cannot afford to rebuild their homes after a disaster.
Regular homeowners insurance does not usually cover flood damage. This is why the Federal Emergency Management Agency offers flood insurance.High premiums, average premiums Nearly $1,000 a yearaccording to Forbes data.
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Low levels of federal flood insurance coverage in Hurricane Ian-affected areas means that rebuilding these communities will take longer, jeopardize the economy and prolong the suffering, experts say.
Nancy Watkins, principal and consulting actuary at Milliman, said: “Or they might think that Federal Disaster Assistance would swoop in and complete them.”
But federal disaster relief isn’t as generous as many people think.
FEMA provides limited emergency assistance to uninsured homeowners, including temporary housing payments at hotels, motels, mobile homes, and basic repairs to make their home habitable. .
But as The New York Times reported in July, FEMA typically doesn’t pay to rebuild homes. Aid he is limited to less than $40,000, which is a fraction of what the rebuild will cost.
Congress can decide to provide additional funding to disaster survivors, usually by awarding funds to the U.S. Department of Housing and Urban Development. This allows states to set up what are known as disaster recovery grants. The state can then use the money to rebuild homes.
But Congress does not have guidelines for determining which disasters deserve additional funding, and whether Congress funds is as much about the political impact of state legislative delegations as it is about the actual level of damage. highly dependent on force. Even when Congress does provide additional funding, it often takes years for that money to reach homeowners.
Disaster survivors who do not have insurance but cannot wait years for assistance can apply for assistance from the Small Business Administration, another federal agency that plays a role in disaster recovery. The agency lends to renters, homeowners, businesses and nonprofits. But these loans have to be repaid. This amounts to a new mortgage, which can be difficult for disaster survivors.
An alternative option for storm victims is to seek help from charities. But as disasters increase and the economy slows, these charities are running thin with no guarantee that they will be able to help everyone in need.
And the scale of that need can be immense.
Last year, only 49.5% of floodplain homes across Florida had flood insurance, according to Milliman. exposed by a hurricane than anywhere else in the country.
This actually puts Florida near the top of the list for flood coverage. Other high-risk states have far fewer. In Texas, 32.1% of homes on flood plains had flood insurance. In Alabama, the number was 21.1%. In Georgia it is 20.7%.
In West Virginia, where steep valleys create the worst flood risk in the country, only 11% of floodplain homes had flood insurance.
According to Steve Bowen, chief scientific officer at reinsurance broker Gallagher Re, homeowners who have flood insurance have increased number has decreased.
Last fall, FEMA began setting the cost of flood insurance based on the specific risks that individual homes face. Prior to that, more general information, such as whether a home was within a floodplain, was used to determine premiums.
The new pricing structure means that rates for riskier housing now reflect closer to the true cost of the risks faced. FEMA made changes to make the insurance program more financially self-sustaining by reducing its reliance on taxpayer financing after major floods.
Officials also hoped a more accurate rate would convey threats to property and perhaps make people think twice about living in an unsafe area.
However, new pricing has caused rates to skyrocket for some homes.
Bowen said the number of homes with federal flood insurance, which had already slowed down since the new prices went into effect, began to drop even more rapidly.
The number of households nationally covered by the insurance program fell by more than 165,000 under the new pricing scheme, a drop of just over 3%, FEMA data shows.
In Florida alone, the number of homes with federal flood insurance has dropped by an average of more than 4,000 homes per month since the new pricing began.
A representative for FEMA was not immediately available for comment.
“FEMA’s heart is in the right place,” Bowen said. Still, he said, “the people at FEMA must be a little disappointed that the numbers actually went down.”