Flood: State of the Risk

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Flood is no longer an “untouchable” risk for private insurers. In fact, data suggests insurers see it as a growing area of opportunity. That’s good news for homeowners who understand the evolving nature of the peril.

For decades, FEMA’s National Flood Insurance Program (NFIP) was practically the only available option for homeowners to obtain flood coverage. Improved data, analysis, and modeling have helped drive increased private-sector interest in flood-risk transfer and mitigation.

In 2016, only 12.6 percent of flood coverage was written by 18 insurers. Between 2016 and 2022, the total flood market grew 24 percent – from $3.29 billion in direct premiums written to $4.09 billion – with 77 private companies writing 32.1 percent of the business. Private insurers are accounting for a bigger piece of a growing pie.

Today’s challenge is to get homeowners and communities to understand the need to insure against flood and how mitigating the risk can help make the coverage more affordable.

As of August 16, 2023