The National Association of Mutual Insurance Companies (NAMIC) has urged U.S. lawmakers to focus on flood prevention as a way to lower insurance costs and make coverage more affordable for homeowners. In testimony delivered to the House Financial Services Subcommittee on Housing and Insurance, NAMIC emphasized the importance of federal support for projects like upgrading infrastructure, improving drainage, and adding protections to individual properties before floods happen.
Flooding is one of the most common natural disasters in the U.S. In fact, all 50 states and 99% of counties have faced at least one flood event in the past 20 years. NAMIC pointed out that while the insurance industry is working to better understand flood risks through research and data, insurance alone won’t solve the problem. They said broader efforts to reduce risk before floods hit must be part of the solution.
The group highlighted a specific issue within the National Flood Insurance Program (NFIP). Only about 1% of the policies cover properties that flood repeatedly, but those homes account for roughly 25% of the claims each year. Tackling the risk at these high-risk properties ahead of time could cut down overall losses significantly.
According to research cited by NAMIC, every dollar spent on flood prevention can save up to $13 in future damage. This makes investing in flood resilience a smart and cost-effective way to manage risk. NAMIC also supports keeping targeted subsidies in the NFIP to help homeowners who are most vulnerable. They stressed the need for clearer information about flood risks so people can make smarter choices about buying properties and insurance.
In closing, NAMIC said solving flood risk problems will take teamwork between federal and state governments, insurers, local communities, and homeowners. Flood prevention should be the base that helps keep insurance affordable and communities safer in the long run.