In our last post, we took a look at some figures found by the National Flood Insurance Program (NFIP) regarding the increase of flood insurance policies in areas that were hit particularly hard by recent natural disasters.
The president of the Independent Insurance Agents of Connecticut (IIAC), Warren Ruppar, said that the storms that have affected the East Coast, especially Connecticut, have made a significant impact on residents, and have made them acutely aware of the need for flood insurance. The NFIP reported that Connecticut residents’ insurance policies increased to 43,365, which is a 5.6 percent increase. Ruppar said, “There is room for improvement” in terms of getting more of Connecticut to protect themselves against future floods.
Colorado was the state that had the third-highest increase in flood insurance policies in the last year. However, there seems to be a stigma about flooding among Colorado residents, because the state is completely land-locked. Many seem to think that flooding shouldn’t be a primary concern because there are no costal barriers to worry about.
The reason that flash flooding is such a high risk in Colorado is that the state has experienced a high number of massive wildfires over the last few years. There were four of the most costly wildfires in history over the last three years, and each fire caused upwards of $100 million in damages according to the Rocky Mountain Insurance Information Association (RMIIA). The executive director of the RMIIA hopes that wildfires can be “teachable moments” about the necessity of flood insurance protection.
There have been many efforts by the NFIP and other industry leaders to try to educate the public about wildfires and how they correlate to flood risks. Officials are hopeful that some of that public education has made an impact and has opened some eyes to the serious threat of floods in Colorado, regardless of their in-land location.
There’s a tremendous concern in the flood insurance industry for the areas that have seen decreases in policy holders. Areas that haven’t been heavily affected by flooding, such as Wyoming and Texas, have seen flood insurance decreases—6 percent and -2.2 percent respectively. The fear is that “people are looking at cost versus what they think the threat is,” according to Walker. Especially in Texas, where they have been in a drought for the last three years, many residents likely doubt that flooding will be an issue for them anytime in the near future.