Rising Inland Flood Risk Demands Urgent Attention in U.S.

The Insurance Information Institute’s recent ‘State of the Risk’ Issues Brief warns that flooding risks are rapidly increasing in U.S. inland areas, driven by both tropical storms and severe thunderstorms. The destruction left by Hurricane Helene in September 2024 illustrates this trend, with record rainfall and flooding impacting communities across the Southeast and overwhelming areas that lacked flood insurance. Flooding claimed hundreds of lives and billions in losses across Florida, Georgia, the Carolinas, Virginia, and Tennessee, leaving many areas severely damaged and underinsured. Western North Carolina, particularly Buncombe County, faced catastrophic impacts with a low federal flood insurance uptake—less than 1 percent—highlighting the flood-protection gap in inland regions.

Historically, few inland residents view flood insurance as necessary, contributing to limited policy uptake. However, private insurers are increasingly participating in the flood insurance market, leveraging enhanced data and analytics to expand coverage options. Since 2019, private insurers’ role has grown, driven by federal regulatory changes that allow mortgage lenders to accept private flood policies.

While flood insurance is vital, the report emphasizes that it alone cannot fully address the risks. Sustainable, resilient development is essential for long-term risk reduction, as demonstrated by communities like Babcock Ranch in Florida, where storm-resilient infrastructure helped prevent significant flood damage during Hurricane Helene. The Triple-I report calls for enhanced incentives and public-private partnerships to promote flood resilience and shift growth away from flood-prone regions.