Florence drenches the Carolinas in test of flood insurance policies
Florence is “going to end up in terms of actual economic loss among the largest floods in U.S. history and probably even larger in terms of economic loss than Sandy,” said R.J. Lehmann, senior fellow for the conservative R Street Institute think tank in Washington, which is a member of the SmarterSafer coalition advocating for reforms to the NFIP. “But in terms of NFIP, it’s really up in the air what the claims are going to look like.”
“My initial take was that it would probably be in (Sandy-Harvey) range, given the size of the storm and the kind of flooding that we’re seeing,” he continued. “On the coast, there is a lot of penetration of NFIP; in the interior, very little. A lot of those counties, including the largest ones, don’t have very much flood insurance, so a lot of this question is going to come down to federal disaster relief rather than insured losses.”
In 2017, private insurers had direct written premiums on flood risk of $12.7 million in South Carolina and $9.4 million in North Carolina, constituting 8.5% and 7% of the flood market, respectively, Mr. Lehmann said, citing National Association of Insurance Commissioners and ratings agency data.
