When Rising Seas Transform Risk Into Certainty

Source: The New York Times Magazine. By Brooke Jarvis

Along parts of the USA East Coast, the entire system of
insuring coastal property is beginning to break down.

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Two houses, one raised with a garage, the other with a higher foundation, sandwich a student rental property with a first-floor elevation below the flooding safe zone in Norfolk, Va. Credit Benjamin Lowy for The New York Times

Flooding is the most common, and most expensive, natural disaster in the United States. Private insurers have long declined to cover it, leaving the government on the hook for disaster assistance after floods. (Hence the famous lawsuits after Hurricane Katrina, when people who came home to empty slabs were asked to prove that their losses were a result of wind and not waves.) Congress created the N.F.I.P. in the late 1960s in response to a series of expensive floods caused by hurricanes and overflowing rivers. It offers insurance coverage, some of it subsidized, to communities that meet floodplain-management requirements; requires people who want loans to buy houses in dangerous places to buy it; and also provides grants for mitigation projects meant to reduce flooding damage, like elevating houses or buying out the owners of flood-prone homes. Private insurers including Farmers, Allstate and 68 other companies also sell and administer the policy on the government’s behalf — and take a sizable cut of the premium. If floods do come, though, it’s still the government that’s on the hook.

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