Nearly a quarter-million households have dropped flood insurance coverage since the federal government began increasing its premiums four years ago.
The alarming number of withdrawals was identified in a study released Tuesday that casts doubt on the Federal Emergency Management Agency’s controversial program to restructure the rates it charges to millions of people who buy flood coverage.
The agency launched the price-raising program called Risk Rating 2.0 in an effort to align the cost of flood coverage with the accurate risk of a property being inundated. It came as FEMA’s National Flood Insurance Program has increasingly faced financial strain from intensifying floods and rising property damage associated with climate change and expanded development.
“I would not say Risk Rating 2.0 should necessarily be repealed. But there are a range of complementary policies that can help address this drop-off in uptake,” said lead author Jesse Gourevitch, an economist at the Environmental Defense Fund.
