Flooding claim stats

Less than half of people who think flood insurance is important actually buy a policy.

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Homeowners all across the US stand at risk for flood damage, whether it’s caused by hurricanes or inland flooding. Although 41% of homeowners agree that flood insurance is a good idea, far less than that have bought a flood policy at all.

Before serious flood damage happens, homeowners should weigh the possible cost of damage against the average $40 per month price for flood insurance.

Which flooding claims are most common?

A majority of flooding claims involve hurricane-related damage. Hurricane storm surges account for 37% of claims, according to a 2017 Congressional Budget Office report on the National Flood Insurance Program (NFIP). Another 16% come from hurricane precipitation.

But avoiding hurricane-prone areas doesn’t save you from deep waters. Inland flooding from streams, ponds, rivers and lakes also make up 36% of claims.

Insurance claims sink drastically to 5% for tropical storms and 2% for other causes like nor’easters. Nor’easters are often violent rain or snowstorms on the East Coast caused by northeast winds. Combined, hurricanes and tropical storms are involved in 58% of claims, and these claims are continuing to rise.

Percentage of different flood claims

Does home insurance cover flooding?

Your home insurance policy won’t cover flooding caused by storms or hurricanes. Many homeowners buy policies from the NFIP directly, but your home insurance company might also offer a way to purchase these policies. You can also get a private flood insurance policy or add a flood endorsement to your current home insurance.

How much is flood insurance?

An NFIP policy costs around $520 per year or $43 a month, based on the median premium reported by the Congressional Budget Office. Most premiums range between $420 and $1,330, with condos and primary homes showing the cheapest costs.

Flood policies through the NFIP add a surcharge to make up for discounted rates in high-risk areas. That surcharge is $250 for secondary homes, costing 10 times more than the surcharge for primary homes.

Which generations buy flood insurance the most?

Millennials agree that flood insurance is important, and they also buy the most flood policies. The National Association of Insurance Commissioners (NAIC) found 25% of Millennials have bought a flood policy in its 2019 survey of 1,000 adults. Only 16% of Gen Xers have bought a policy, and that drops even more to just 9% for Baby Boomers.

Flood policies bought by generation

Although 41% of people in the NAIC survey think flood insurance is a good idea, only 17% said they hold a policy. Many homeowners think their home insurance covers flooding, not realizing they need a separate policy instead.

Who thinks flood insurance is a good idea by generation

Bottom line

Flooding can happen at any time to nearly any homeowner, causing costly damage not covered by standard home insurance. Whether or not you live in a high-risk area, consider flood insurance to protect against common types of floods.

How did we find these flooding stats?

First, we dove into 2017–2018 The National Flood Insurance Program: Financial Soundness and Affordability report from the Congressional Budget Office. We dug out information on the most common home insurance claims reported in the last 35 years.

However, the data doesn’t total 100% because it accounted for charges like service fees that aren’t related to the loss incidents. We also added hurricane and tropical storm percentages together to compare the significance of these claims combined against other losses.

Next, we highlighted the median annual premium for NFIP policies given by the Congressional Budget Office report. We included the range of costs for most home premiums, but a few premiums did go as high as $1,950 for secondary homes. We then compared policy surcharges for primary versus secondary homes. These annual premiums or surcharges don’t account for private flood insurance companies.

Finally, we sorted through data from the 2019 National Association of Insurance Commissioners flood insurance survey. This survey was given to 1,004 adults over age 18 from May 20 to 22. The adults surveyed represented the demographics of the US population.

This survey used a survey tool called CARAVAN and was conducted by Engine. However, the data represents self-reported numbers rather than the actual number of flood policies written in the US.

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