Flood Insurance

NATIONAL FLOOD INSURANCE PROGRAM

Flood damage is excluded under standard homeowners and renters insurance policies. Flood coverage, however, is available in the form of a separate policy both from the National Flood Insurance Program (NFIP) and from a few private insurers. Congress created the NFIP in 1968 in response to the rising cost of taxpayer-funded disaster relief for flood victims and the increasing amount of damage caused by floods. The NFIP makes federally backed flood insurance available in communities that agree to adopt and enforce floodplain management ordinances to reduce future flood damage. The NFIP is self-supporting for the average historical loss year. This means that unless there is a widespread disaster, operating expenses and flood insurance claims are financed through premiums collected. The NFIP provides coverage for up to $250,000 for the structure of the home and $100,000 for personal possessions. Private flood insurance is available for those who need additional insurance protection, known as "excess coverage,” over and above the basic policy or for people whose communities do not participate in the NFIP. Some insurers have introduced special policies for high-value properties. These policies may cover homes in noncoastal areas and/or provide enhancements to traditional flood coverage. The comprehensive portion of an auto insurance policy includes coverage for flood damage. A 2011 poll by the Insurance Information Institute found that 14 percent of American homeowners had a flood insurance policy, up from 10 percent in 2010 but still below the 17 percent who said they purchased flood insurance in 2008. The percentage of homeowners with flood insurance was highest in the South, at 19 percent, up from 14 percent in 2010 and back to the level of 2009. Thirteen percent of Midwestern homeowners had a flood insurance policy in 2011 along with 12 percent of homeowners in the West and 5 percent in the Northeast.

As of June 2012, 86 insurance companies participated in the "Write-Your-Own" program, started in 1983, in which insurers issue policies and adjust flood claims on behalf of the federal government under their own names. As of July 2011, 69 percent of NFIP flood insurance policies covered single family homes, 20 percent covered condominiums and 5 percent covered businesses and other non-residential properties. 2 to 4 family units and other residential policies accounted for the remaining 6 percent. Rivers and streams reached record levels in 10 states as a result of Hurricane Irene in August 2011.

NATIONAL FLOOD INSURANCE PROGRAM, 1980-2010      Losses paid Year Policies in force at year-end Number Amount ($000) 1980 2,103,851 41,918 $230,414 1985 2,016,785 38,676 368,239 1990 2,477,861 14,766 167,897 1995 3,476,829 62,441 1,295,578 2000 4,369,087 16,362 251,721 2005 4,962,011 212,897 17,714,793 2006 5,514,895 24,595 640,671 2007 5,655,919 23,132 610,395 2008 5,684,275 74,300 3,452,271 2009 5,700,235 30,839 773,065 2010 5,646,735 27,923 727,877 Source: U.S. Department of Homeland Security, Federal Emergency Management Agency. View Archived Tables

In 2010 the average amount of flood coverage was $220,577 and the average premium was $594. The average flood claim in 2010 was $26,067, down from $46,464 in 2008, the year of Hurricane Ike. NFIP premiums written rose from $1.7 billion in 2000 to $3.4 billion in 2010. In the wake of the August 2010 oil spill in the Gulf of Mexico, the Federal Emergency Management Agency said that the NFIP would cover property damage caused by the “mixing of oil and other pollutants in flood water". As of November the federal government had declared 56 major flood disasters in 2011, including record flooding in Minot, North Dakota. In all of 2010, there were 51 federally declared major flood disasters.

FLOOD INSURANCE IN THE UNITED STATES, 2011 (1)

	Direct NFIP business		WYO business		Total NFIP/WYO
State	Number of policies	Insurance in force (2) ($ millions)	Number of policies	Insurance in force (2) ($ millions)	Number of policies	Insurance in force (2) ($ millions)
Alabama	12,212	$2,258.0	45,129	$9,640.5	57,341	$11,898.6
Alaska	848	167.3	2,132	520.3	2,980	687.6
Arizona	458	14.4	34,406	7,823.4	34,864	7,837.8
Arkansas	6,775	1,476.0	14,279	1,572.7	21,054	3,048.7
California	4,194	551.4	261,167	68,074.5	265,361	68,625.9
Colorado	48,309	11,727.7	-28,102	-7,229.1	20,207	4,498.6
Connecticut	4,461	950.4	37,336	8,649.7	41,797	9,600.1
Delaware	3,057	654.7	22,123	5,455.2	25,180	6,109.9
D.C.	4,997	1,222.6	-2,950	-875.0	2,047	347.7
Florida	127	19.1	2,057,826	470,984.5	2,057,953	471,003.6
Georgia	207,903	50,590.7	-110,895	-27,250.5	97,008	23,340.2
Hawaii	183	34.1	59,854	12,458.0	60,037	12,492.1
Idaho	2,655	569.4	4,499	1,023.8	7,154	1,593.2
Illinois	1,445	308.5	48,422	8,316.7	49,867	8,625.2
Indiana	14,616	2,310.9	17,684	2,996.3	32,300	5,307.2
Iowa	9,151	1,284.7	9,446	2,002.0	18,597	3,286.7
Kansas	4,250	624.8	8,863	1,458.3	13,113	2,083.1
Kentucky	3,423	486.3	21,200	3,043.8	24,623	3,530.0
Louisiana	4,524	572.5	489,116	111,552.9	493,640	112,125.4
Maine	143,780	31,132.2	-134,651	-29,188.0	9,129	1,944.2
Maryland	822	156.6	70,006	15,112.9	70,828	15,269.4
Massachusetts	8,118	1,838.2	48,029	10,897.5	56,147	12,735.8
Michigan	6,833	1,421.9	18,216	2,773.1	25,049	4,195.0
Minnesota	6,200	907.2	13,462	3,264.0	19,662	4,171.2
Mississippi	3,849	780.1	72,760	15,649.8	76,609	16,429.9
Missouri	19,735	4,195.0	7,939	284.8	27,674	4,479.8
Montana	5,733	800.1	2,274	643.6	8,007	1,443.7
Nebraska	3,273	477.1	10,669	1,831.0	13,942	2,308.1
Nevada	2,701	594.7	11,491	2,788.0	14,192	3,382.6
New Hampshire	765	151.0	8,585	1,682.2	9,350	1,833.3
New Jersey	20,989	4,263.3	212,852	49,116.5	233,841	53,379.8
New Mexico	3,014	498.5	14,045	2,550.1	17,059	3,048.6
New York	23,725	5,534.7	143,621	35,294.7	167,346	40,829.5
North Carolina	17,703	4,088.8	119,764	27,862.7	137,467	31,951.5
North Dakota	3,981	893.7	17,246	4,071.9	21,227	4,965.5
Ohio	9,194	1,231.3	32,587	5,465.5	41,781	6,696.8
Oklahoma	4,238	674.6	12,915	2,272.7	17,153	2,947.4
Oregon	7,863	1,706.7	26,829	6,019.4	34,692	7,726.1
Pennsylvania	12,490	1,737.4	57,833	10,965.2	70,323	12,702.6
Rhode Island	904	173.0	15,330	3,734.3	16,234	3,907.3
South Carolina	28,608	7,324.7	174,136	41,580.6	202,744	48,905.3
South Dakota	1,468	290.0	5,873	1,255.8	7,341	1,545.8
Tennessee	7,337	1,452.5	26,564	5,748.4	33,901	7,200.9
Texas	135,015	31,827.4	520,349	129,665.2	655,364	161,492.6
Utah	1,014	199.8	3,784	878.7	4,798	1,078.5
Vermont	504	67.5	3,591	699.0	4,095	766.6
Virginia	21,229	4,859.4	92,751	22,704.3	113,980	27,563.7
Washington	7,636	1,590.5	39,214	9,386.6	46,850	10,977.2
West Virginia	6,028	619.8	15,470	2,044.5	21,498	2,664.3
Wisconsin	2,771	421.2	13,791	2,440.4	16,562	2,861.6
Wyoming	705	136.9	2,457	527.6	3,162	664.4
American Samoa	0	0.0	458	14.4	458	14.4
Guam	20,114	4,564.0	-19,857	-4,511.2	257	52.9
Puerto Rico	498	27.7	59,110	5,478.5	59,608	5,506.3
Virgin Islands	340	60.3	1,995	296.7	2,335	357.0
United States	874,260	$192,780.1	4,671,325	$1,070,242.8	5,585,797	$1,264,043.6

(1) Direct and WYO business may not add to total due to rounding.
(2) Total limits of liability for all policies in force.

Source: U.S. Department of Homeland Security, Federal Emergency Management Agency.

View Archived Tables

TOP TEN SIGNIFICANT FLOOD EVENTS, RANKED BY NATIONAL FLOOD INSURANCE PROGRAM PAYOUTS (1)

Rank	Event	Location	Date	Number of paid losses	Amount paid ($ millions)	Average paid loss
1	Hurricane Katrina	AL, FL, GA, LA, MS, TN	Aug. 2005	166,675	$16,128	$96,764
2	Hurricane Ike	AL, LA, TX	Sep. 2008	46,585	2,644	57,125
3	Hurricane Ivan	AL, DE, FL, GA, LA, MD, MS, NJ, NY, NC, OH, PA, TN, VA, WV	Sep. 2004	27,648	1,586	57,381
4	Tropical Storm Allison	FL, LA, MS, NJ, PA, TX	Jun. 2001	30,663	1,104	36,000
5	Hurricane Irene	CT, DC, DE, MA, ME, MD, NC, NH, NJ, NY, PA, PR, RI, VA, VT	Aug. 2011	36,360	928	25,511
6	Louisiana Flood	LA	May 1995	31,343	585	18,667
7	Hurricane Isabel	DE, MD, NJ, NY, NC, PA, VA, WV	Sep. 2003	19,857	493	24,806
8	Hurricane Floyd	CT, DE, FL, GA, MA, ME, MD, NH, NJ, NY, NC, PA, RI, SC, VA, VT	Sep. 1999	20,438	462	22,618
9	Hurricane Rita	AL, AR, FL, LA, MS, TN, TX	Sep. 2005	9,494	470	49,534
10	Hurricane Opal	AL, NC, PR, SC, TN	Oct. 1995	10,343	406	39,208

(1) Includes events from 1978 to December 31, 2011. Defined by the National Flood Insurance Program as an event that produces at least 1,500 paid losses. Stated in dollars when occurred.

Source: U.S. Department of Homeland Security, Federal Emergency Management Agency.

FLOOD INSURANCE POLICIES IN FORCE BY OCCUPANY TYPE, 2011

Source: Federal Emergency Management Agency (FEMA).

NATIONAL FLOOD INSURANCE PROGRAM PAYOUTS, 2010 (1) State name Total number of claims Total claims payments ($ millions) Alabama 379 $6.00 Alaska 4 0.08 Arizona 121 2.89 Arkansas 669 17.30 California 486 5.43 Colorado 48 0.19 Connecticut 927 8.26 Delaware 172 1.18 D.C. 23 0.02 Florida 1,994 38.56 Georgia 360 2.91 Hawaii 25 0.30 Idaho 18 0.25 Illinois 2,058 24.70 Indiana 115 1.14 Iowa 675 16.84 Kansas 115 1.23 Kentucky   1,260 35.82 Louisiana 1,963 25.29 Maine 100 0.86 Maryland 319 1.10 Massachusetts 2,121 24.86 Michigan 76 0.31 Minnesota 432 5.14 Mississippi 243 5.93 Missouri 770 15.78 Montana 18 0.02 Nebraska 366 5.56 Nevada 2 NA New Hampshire 176 2.09 New Jersey 6,420 107.92 New Mexico 36 0.39 New York 2,975 20.96 North Carolina 1,518 10.36 North Dakota 368 3.29 Ohio 157 1.87 Oklahoma 281 5.50 Oregon 26 0.08 Pennsylvania 629 4.34 Puerto Rico 424 5.85 Rhode Island 1,764 39.76 South Carolina 191 1.26 South Dakota 334 3.07 Tennessee 4,702 221.18 Texas 2,977 57.66 Utah 7 0.13 Vermont 7 0.02 Virgin Islands 26 0.64 Virginia 6,843 104.44 Washington 63 0.18 West Virginia 775 11.45 Wisconsin 493 5.40 Wyoming 20 0.03 Total 47,071 $856.00 (1) October 1, 2009 through September 30, 2010. NA=Data not available. Source: U.S. Department of Homeland Security, Federal Emergency Management Agency.

NFIP flood insurance payouts were highest in Tennessee in 2010, followed by New Jersey, Virginia, Texas and Rhode Island. Florida, Kentucky, Louisiana, Massachusetts and Illinois round out the top ten.

THE TEN MOST SIGNIFICANT FLOOD EVENTS BY NATIONAL FLOOD INSURANCE PROGRAM PAYOUTS (1)

Rank	Event	Location	Date	Number of paid losses	Amount paid ($ millions)	Average paid loss
1	Hurricane Katrina	AL, FL, GA, LA, MS, TN	Aug. 2005	167,397	$16,208	$96,821
2	Hurricane Ike	AR, IL, IN, KY, LA, MO, OH, PA, TX	Sep. 2008	46,316	2,642	57,033
3	Hurricane Ivan	AL, DE, FL, GA, LA, MD, MS, NJ, NY, NC, OH, PA, TN, VA, WV	Sep. 2004	27,647	1,586	57,371
4	Tropical Storm Allison	FL, LA, MS, NJ, PA, TX	Jun. 2001	30,663	1,104	36,000
5	Louisiana flood	LA	May 1995	31,343	585	18,667
6	Hurricane Isabel	DE, MD, NJ, NY, NC, PA, VA, WV	Sep. 2003	19,864	493	24,825
7	Hurricane Rita	AL, AR, FL, LA, MS, TN, TX	Sep. 2005	9,514	472	49,562
8	Hurricane Floyd	CT, DE, FL, GA, MA, ME, MD, NH, NJ, NC, PA, SC, VA, VT	Sep. 1999	20,438	462	22,618
9	Hurricane Opal	AL, NC, PR, SC, TN	Oct. 1995	10,343	406	39,208
10	Hurricane Hugo	GA, NC, PR, SC, VA, U.S. Virgin Islands	Sep. 1989	12,840	376	29,317

(1) Includes events from 1978 to July 31, 2011. Defined by the National Flood Insurance Program as an event that produces at least 1,500 paid losses. Stated in dollars when occurred.

Source: U.S. Department of Homeland Security, Federal Emergency Management Agency.