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Climate change is increasing flood risk around the country. Insurance rates are not keeping pace, report finds

February 22, 2021. Summarized by summa-bot.

Compression ratio: 17%. 1 min read.

<<enter caption here>> on August 30, 2017 in Houston, Texas.

Flooding is the most costly natural disaster in the United States. As climate change increases the risk of flood damage, a new report finds that the country's National Flood Insurance Program is greatly underestimating the financial threat to homeowners.

A new report finds that there is a growing gap between the financial threat homeowners face from flooding and the insurance rates some pay to cover that risk.

Currently, there are nearly 4. 3 million residential properties around the country with a substantial risk of financial loss due to flooding.

A separate report from the foundation last year estimated that there are a total of 14. 6 million properties around the country with substantial flood risk.

The owners of around 5. 9 million of those properties may be unaware of their flood risk because they are located outside of FEMA's Special Flood Hazard Areas (SFHA), and therefore aren't required to buy flood insurance even if they hold a government-backed mortgage loan, the report found.

To address these problems, FEMA is expected to roll out a new system for setting flood insurance rates later this year called Risk Rating 2. 0, which the agency says will utilize the latest technology to better capture the risk for each individual property.

David Maurstad, the senior executive of the National Flood Insurance Program, said that the First Street Foundation's findings should not be taken as a preview of the rate changes flood insurance policy holders can expect when Risk Rating 2. 0 goes into effect.

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