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Record 2025 US Flooding Highlights Urgent Need for Flood Insurance and Resilience Measures, Triple-I’s New Issues Brief Explains

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AMSF The article discusses the growing need for flood insurance due to increased flooding events. American Financial Group is a property and casualty insurer, which could benefit from increased demand for flood insurance, but the article does not directly mention the company or its performance. WRB The article highlights the expansion of private flood insurance. W. R. Berkley Corporation is a commercial lines insurer that may participate in this growing market. However, the article does not provide specific details about the company's involvement or performance in flood insurance. PGR The article points to the growth in private flood insurance. Progressive is a major insurer that could see increased business from this trend. However, the article does not specifically mention Progressive or its flood insurance offerings. ALL The article discusses the increasing demand for flood insurance and the growth of the private flood insurance market. Allstate is a large property and casualty insurer that could benefit from this trend. However, the article does not specifically mention Allstate or its flood insurance products. CB The article notes the expansion of private flood insurance. Chubb is a global insurer with a significant presence in property and casualty insurance, and could benefit from this market growth. However, the article does not specifically mention Chubb or its flood insurance business. TRV The article highlights the growing need for flood insurance and the expansion of the private market. Travelers is a major property casualty insurer that could see increased demand for its flood-related products. However, the article does not specifically mention Travelers. MKL The article mentions the growth in private flood insurance. Markel Group, through its insurance segment, could be a beneficiary of this trend. However, the article does not specifically name Markel or detail its participation in the flood insurance market. ACGL The article discusses the expansion of private flood insurance. Arch Capital Group is an insurer that could benefit from increased demand in this sector. However, the article does not specifically mention Arch Capital Group or its flood insurance offerings. VRSN The article mentions the use of advanced analytics and improved data collection by insurers, including work by nonprofit Climate Central, to assess flood risk. VeriSign is not directly involved in insurance or flood risk assessment, making its relevance unclear.

MALVERN, Pa.--( BUSINESS WIRE)--Deadly floods swept across the United States in 2025 at an unprecedented pace, underscoring the growing risk of inland and flash flooding and the critical importance of adequate flood insurance, according to the Insurance Information Institute’s (Triple-I’s) latest issues brief, Flood Insurance: State of the Risk. From Central Texas to California, North Carolina and New York City, communities experienced widespread devastation, including more than 130 fatalities in the Texas Hill Country alone.

“Flooding is not only a growing threat, but it’s a collective challenge that requires action at every level, from individuals, businesses and government."

Flooding triggered by tropical storms, severe convective storms and atmospheric rivers caused significant property damage nationwide. New York City saw multiple flash floods, while California experienced winter storms that dropped up to nearly half a year’s worth of rain in some areas, leading to mudflows and hundreds of affected homes. In North Carolina, residents are still recovering from catastrophic flooding tied to Hurricane Helene in autumn 2024. In some of the hardest-hit communities, fewer than 1% of households carried flood insurance, leaving many families to rely on federal disaster assistance or personal savings to rebuild.

Flood Insurance Gaps and Market Growth

Despite the rising risk, many homeowners believe flood coverage is unnecessary unless required by a mortgage lender, and some drop coverage once their mortgage is paid. A 2023 survey by Munich Re and the Triple-I found that 64% of homeowners believed their residences were not at risk of flooding. More than half of flood insurance policyholders are covered through FEMA’s National Flood Insurance Program (NFIP), though private insurers are expanding rapidly. Between 2016 and 2024, private flood insurance grew nearly 43%, from $3.29 billion in direct premiums to $4.7 billion, with 79 private companies writing just over 27% of the U.S. market.

Advanced analytics and improved data collection, including work by nonprofit Climate Central, are helping insurers better assess flood risk and expand coverage options. These insights are critical for both private insurers and communities aiming to build resilience against future floods.

Incentivizing Risk Reduction

Programs like NFIP’s Community Rating System (CRS) encourage communities to adopt floodplain management practices beyond minimum standards, offering premium discounts of up to 45% for homeowners in top-rated communities. Investments in resilience, such as mitigation projects and community planning, have been shown to save up to $33 in avoided economic costs for every dollar spent.

Recent cancellations of programs like FEMA’s Building Resilient Infrastructure and Communities (BRIC) funding and EPA’s Community Change Grants illustrate the ongoing challenges in securing mitigation funding, particularly for vulnerable populations, including Native American communities.

“Flooding is not only a growing threat, but it’s a collective challenge that requires action at every level, from individuals, businesses and government,” said Sean Kevelighan, Triple-I CEO. “Investing in flood insurance and mitigation measures today can dramatically reduce the human and economic costs of tomorrow’s disasters.”

About the Insurance Information Institute (Triple-I)

Since 1960, the Insurance Information Institute (Triple-I) has been the trusted voice of risk and insurance, delivering unique, data-driven insights to educate, elevate and connect consumers, industry professionals, policymakers and the media. An affiliate of The Institutes, Triple-I represents a diverse membership accounting for nearly 50% of all U.S. property/casualty premiums written. Our members include mutual and stock companies, personal and commercial lines, primary insurers and reinsurers – serving regional, national and global markets.

About The Institutes

The Institutes® are a not-for-profit comprised of diverse affiliates that educate, elevate, and connect people in the essential disciplines of risk management and insurance. Through products and services offered by The Institutes 20 affiliated business units and backed by more than 115 years of experience as a trusted knowledge partner, we empower people and organizations to help those in need with a focus on understanding, predicting, and preventing losses to create a more resilient world. Learn more at Global.TheInstitutes.org.

The Institutes is a registered trademark of The Institutes. All rights reserved.