Assessing Current and Future Freshwater Flood Risk from North Atlantic Tropical Cyclones via Insurance Claims.

The most recent decades have witnessed record breaking losses associated with U.S. landfalling tropical cyclones (TCs). Flood-related damages represent a large portion of these losses, and although storm surge is typically the main focus in the media and of warnings, much of the TC flood losses are instead freshwater-driven, often extending far inland from the landfall locations. Despite this actuality, knowledge of TC freshwater flood risk is still limited. Here we provide for the first time a comprehensive assessment of the TC freshwater flood risk from the full set of all significant flood events associated with U.S. landfalling TCs from 2001 to 2014. We find that the areas impacted by freshwater flooding are nearly equally divided between coastal and inland areas. We determine the statistical relationship between physical hazard and residential economic impact at a community level for the entire country. These results allow us to assess the potential future changes in TC freshwater flood risk due to changing climate pattern and urbanization in a more heavily populated U.S. Findings have important implications for flood risk management, insurance and resilience.

Quantifying riverine and storm-surge flood risk by single-family residence: application to Texas.

The development of catastrophe models in recent years allows for assessment of the flood hazard much more effectively than when the federally run National Flood Insurance Program (NFIP) was created in 1968. We propose and then demonstrate a methodological approach to determine pure premiums based on the entire distribution of possible flood events. We apply hazard, exposure, and vulnerability analyses to a sample of 300,000 single-family residences in two counties in Texas (Travis and Galveston) using state-of-the-art flood catastrophe models. Even in zones of similar flood risk classification by FEMA there is substantial variation in exposure between coastal and inland flood risk. For instance, homes in the designated moderate-risk X500/B zones in Galveston are exposed to a flood risk on average 2.5 times greater than residences in X500/B zones in Travis. The results also show very similar average annual loss (corrected for exposure) for a number of residences despite their being in different FEMA flood zones. We also find significant storm-surge exposure outside of the FEMA designated storm-surge risk zones. Taken together these findings highlight the importance of a microanalysis of flood exposure. The process of aggregating risk at a flood zone level-as currently undertaken by FEMA-provides a false sense of uniformity. As our analysis indicates, the technology to delineate the flood risks exists today.

Policy tenure under the U.S. National Flood Insurance Program (NFIP).

In the United States, insurance against flood hazard (inland flooding or storm surge from hurricanes) has been provided mainly through the National Flood Insurance Program (NFIP) since 1968. The NFIP covers $1.23 trillion of assets today. This article provides the first analysis of flood insurance tenure ever undertaken: that is, the number of years that people keep their flood insurance policy before letting it lapse. Our analysis of the entire portfolio of the NFIP over the period 2001-2009 reveals that the median tenure of new policies during that time is between two and four years; it is also relatively stable over time and levels of flood hazard. Prior flood experience can affect tenure: people who have experienced small flood claims tend to hold onto their insurance longer; people who have experienced large flood claims tend to let their insurance lapse sooner. To overcome the policy and governance challenges posed by homeowners' inadequate insurance coverage, we discuss policy recommendations that include for banks and government-sponsored enterprises (GSEs) strengthening their requirements and the introduction of multiyear flood insurance contracts attached to the property, both of which are likely to provide more coverage stability and encourage investments in risk-reduction measures.