As the hurricane season reaches its midway-point, the U.S Federal Emergency Management Agency (FEMA) has called on Floridians to secure and maintain flood insurance.
FEMA states that only half of Florida homeowners in high-risk areas had insurance against flooding before hurricane Irma made landfall late last year.
Concurrently, however, the National Flood Insurance Program – a government-administered program that protects against flooding – has more policies in Florida than any other state.
“Floods are the most common and costly natural disasters in the United States. A flood-insurance policy protects policyholders financially even when a presidential disaster is not declared or if they live in a county that was not designated for federal assistance.”
FEMA estimates that current NFIP claims for Irma damage total more than $1.1 billion, with an average closed claim payment of $49,740.
NFIP recently launched its first catastrophe bond to transfer risk to the capital markets. Issued via FloodSmart Re, a Bermuda domiciled special purpose insurance vehicle, the catastrophe bond is an attempt to secure $275 million of reinsurance protection for FEMA.
