Climate Change Ups the Ante for Flood Insurance Reform

Written by Tom Fry on . Posted in Learn, The Wonk Room
















The flooding images from Australia and Brazil this week are riveting and terrifying: cars and houses swept downstream by roiling rivers; people being thrown ropes and clinging to submerged trees waiting for rescue; only rooftops of houses poking out from muddy, brown water.

More than 500 people were killed near Rio de Janeiro after storms dropped the equivalent of a month’s rain in a few hours Wednesday, releasing mudslides through mountain towns. Local news outlets were calling it the worst weather-related disaster in Brazil’s history.

Meanwhile in water-logged Queensland, Australia, two months of drenching rains culminated in flash floods this week, forcing as many as 20,000 people out of their homes. Employees and partners of The Nature Conservancy were among those affected.

Already, as the flood waters recede, discussion is underway on how to rebuild and reduce future flood damages.

There have been decades of similar discussions here in the U.S. following our own flooding disasters. Remember the Mississippi River floods of 1993New Orleans after Katrina? And Southern California just last month?

On measures of lives lost and property damage, floods were the number-one natural disaster in the U.S. during the 20th century, according to the U.S. Geological Survey.

Now an effort is underway to try to make the next flood less devastating.

The Federal Emergency Management Agency or FEMA is studying how to reform the National Flood Insurance Program, created by Congress 40 years ago to offer coverage for flood-prone properties (typically not included in standard homeowner policies).

The “Rethinking NFIP” web site summarizes why reform is needed: “The NFIP was designed as a means of discouraging unwise occupancy of flood prone areas, yet occupancy of these areas has expanded since 1968. Additionally, as risks continue to increase, the cost of flood insurance mirrors that increase, making it unaffordable for many Americans.”

Only 20 percent to 30 percent of individuals exposed to flood hazards actually purchase insurance.

The unintended consequence of the current flood insurance program is more – not less – development in areas that increase individual and community risk from both flood and storm surge. The potential of these same vulnerable areas to act as natural buffers, protecting both people and property during floods, is compromised as a result.

Flood insurance reform should incorporate a full accounting of the costs and benefits of flood protection solutions, including the value of natural services provided by floodplains, wetlands and dunes that absorb flood waters and waves if left in a natural state.

With more extreme weather predicted with climate change, including intense storms and bursts of heavy rainfall, the time is right to figure out how to improve key elements of the nation’s disaster preparedness and response system, including the flood insurance system. The best policy solutions will seek to reduce costs to property owners and taxpayers and risk to people, life and property.

Reform offers an opportunity to help flood-prone communities plan “climate-smart” development and better prepare for the magnitude of flooding disasters that may become more common in a rapidly warming world.

Tom Fry is senior policy advisor for climate adaptation at The Nature Conservancy

Photo by: Flickr user Elspeth and Evan (Brisbane residents watch the flood waters.)

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