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More on Home Insurance
Stats to help you understand flood insurance — from the most common types of claims to how much it costs.
90% • The percentage of natural disasters in the United States that involve flooding1
98% • The percentage of U.S. counties that are impacted by a flood event2
43% • Percentage of homeowners who incorrectly believe their homeowners insurance covers flooding1
48% • The growth in companies writing private flood insurance from 2016 to 20173
30 days • The amount of time it takes a National Flood Insurance Program (NFIP) policy to kick in2
$700 • The average cost of NFIP flood insurance in the United States2
$250,000 • The building coverage limit in a NFIP flood insurance policy2
$100,000 • The contents coverage limit in a NFIP flood insurance policy2
20% • The percentage of flood insurance claims that come from homes in low-to-moderate flood risk areas1
$20,000 • Potential cost of damage from just one inch of water2
$43,000 • The average NFIP flood claim payout2
As of 2018, the average cost of an NFIP flood insurance policy is $700, according to the latest data provided by the Federal Emergency Management Agency (FEMA). Your flood insurance costs are generally based on the following factors:
State averages were calculated using data provided by the Insurance Information Institute (III). We divided the total in-force premium in each state by the number of in-force policies in each state.
|State||Average premium||State||Average premium|
|District Columbia||$723.61||New York||$1,154.84|
As you can see, states that aren’t prone to flooding, like Pennsylvania, Vermont, and West Virginia, have the highest average rates. States that experience the most flooding — Florida, Louisiana, and Texas — have the lowest average rates. Why is that?
It’s a matter of sample size. If you live in a non-coastal state and you have flood insurance, that’s probably because you live on a floodplain, where rates are generally the highest.
Conversely, many more homes in low- to moderate-risk areas of coastal states have flood insurance than that of their inland counterparts. When you take into account that NFIP flood insurance in lower-risk areas can be as low as $200, that may account for the average rate discrepancy.
Here’s the total number of active NFIP flood insurance policies per state as of 2017, according to the III. The table also includes each state’s total in-force premium.
|State||Number of policies||Combined in-force policy premium ($ millions)||State||Number of policies||Combined in-force policy premium ($ millions)|
The average year-over-year NFIP flood insurance claim is $43,000, according to FEMA. Flood insurance may be pricey, but flood damage is even pricer. Here’s a cool FEMA visual that shows how flood events have impacted your specific state or county.
Below is the total number of flood insurance claims and claim reimbursements by state as of 2016, according to the III.
|State||Total claims||Total claim payouts ($ millions)||State||Total claims||Total claim payouts ($ millions)|
Here’s the average flood claim payout per year up until 2017, according to FEMA.
|Year||Total policies||Average flood claim payout|
The number of insurance companies writing private flood coverage has increased drastically over the last three years: from 46 companies in 2016 to 89 companies in 2017 to 124 companies in 2018, according to the Insurance Journal.
Why is the private flood insurance industry on the upswing, you ask? In the past, flood insurance was viewed as an untouchable risk. But thanks to technological advancements in recent years, flood events are more predictable, flood maps are more accurate than that of their FEMA counterparts, and it's now easier to assess the risk faced by each home.
Here are the top writers of private flood insurance in the U.S. by total direct premiums, according to an Insurance Journal report. Direct premiums are the amount insurance companies make off of each individual insurance policy.
|Insurance company||Total direct premium|
Pat Howard is an Insurance Editor at Policygenius in New York City, specializing in homeowners insurance. He has been featured on Property Casualty 360, MSN, and more. Pat has a B.A. in journalism from Michigan State University.
Policygenius’ editorial content is not written by an insurance agent. It’s intended for informational purposes and should not be considered legal or financial advice. Consult a professional to learn what financial products are right for you.
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