The devastation brought by Hurricane Helene has also created a new disaster for homeowners now facing costly recovery efforts.
What's happening?
As explained by the Palm Beach Post, residents across the southeastern United States typically don't have flood insurance included in their property policies, forcing them to cover the immense damage caused by Hurricane Helene out of their own pockets.
The insurance industry-funded Insurance Information Institute revealed that "in the counties hardest hit by Hurricane Helene's deadly inland tear from Georgia to North Carolina, fewer than 1% of the properties are insured against flooding through the National Flood Insurance Program (NFIP), which underwrites most of the nation's flood insurance policies," per the Post.
Mark Friedlander, director of communications for the Insurance Information Institute, warned that Helene's victims are facing a historic financial crisis.
"Helene may be the largest uninsured loss we have seen from a landfalling hurricane because of the widespread devastation in areas where flood insurance take-up rates are so low," Friedlander told the Post.
Why is this important?
The insurance industry has already been dealing with a longstanding issue of an inability to manage financial risks caused by unforeseen extreme weather events. In states like California, Florida, and Louisiana, big-name companies are dropping home insurance policies at unprecedented rates, leaving residents scrambling for coverage or forced to turn to expensive, government-run policies.
While homeowners' insurance is already a budding catastrophe, the lack of flood insurance for residents in flood-prone areas creates another set of concerns.
"Home insurance is the acute crisis — like an avalanche," Michael Hecht, president and CEO of Greater New Orleans, Inc., told the Post. "Flood insurance, because the (premium) increases are capped at 18% a year, is a slow-moving crisis, like a melting glacier."
A lack of awareness among consumers is at the heart of the issue, as Dan Kaniewski, former FEMA deputy administrator for resilience, told the Post that most homeowners "are unaware of their standard policy's limitations and don't understand that living in a flood hazard zone is not a prerequisite for fortifying property with flood insurance."
What's being done about this?
Unfortunately, the outlook for fixing these issues appears grim. The Post explained that the federally run flood insurance program has not been able to receive a multiyear authorization renewal from Congress since 2017, with the most recent authorization being approved on Sept. 20 and expiring on Dec. 20.Â
National flood proponents contend that such a short-term commitment has prevented FEMA from addressing the long-term issues plaguing the flood insurance program, causing an increasing number of policyholders to drop their coverage.
Kaniewski said as Helene's victims continue to attempt to return to their old lives, many across the country will begin to learn of the importance of flood insurance.
"It's only going to become more apparent that very few of these disaster survivors have flood insurance and they will struggle through this disaster recovery," he told the Post. "It's going to take the government, at all levels, philanthropic organizations and friends and family to get them back on their feet."
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