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Hurricane Harvey Shows How Bad Flood Insurance Is in the U.S.

August 30, 2017, 8:26 PM UTC

Over 50 inches of rain has fallen in less than a week in Houston—which exceeds the city’s annual average—and southwest Louisiana was shared in the deluge to a lesser extent. Hurricane Harvey is expected to finally weaken Wednesday night, but already, an estimated 30,000 people have been displaced in Houston alone.

Flood insurance, which seeks to enable families to rebuild houses and resume their lives, does not remedy the personal costs or the larger civic expenditures in the immediate wake of a tragic inundation. The extensive flooding in Houston, Beaumont, Texas, and southwest Louisiana has exposed many of the shortcomings of the nation’s current flood insurance program—as have a series of recent floods across south Louisiana in the past year.

Currently, the flood insurance program requires homebuyers to purchase policies in certain designated high-risk zones. As Congress goes to work on flood insurance reform next month, they should recognize that cities, particularly those with millions of residents in the Gulf Coast, have enabled development to expand well beyond safe landscapes. Furthermore, every home, school, shopping center, and parking lot sheds water quickly, which strains drainage systems that were not designed to handle 6 inches an hour or 20 inches in two days.

Baton Rouge, La. and Lafayette, La. suffered flood damages well beyond the expectations of residents in the past year after rainfall of more than 20 inches. Many residents, as is the case in Houston today, did not have flood insurance, and local leaders requested disaster relief funds to enable recovery—Louisiana was able to secure only a portion of the funds it requested. Local governments are not able to handle the cost of extreme events, so they regularly turn to the federal government for assistance. In these tight fiscal times, Congress has begun to push back against disaster relief—as in the case of Superstorm Sandy and the Louisiana floods in 2016.

Congress needs to keep in mind that storms like the ones of the past year are becoming commonplace. An insurance system designed to put people back in their homes no longer makes fiscal sense if they will face a repeat event. Two simple steps can help remedy the shortfall in the flood insurance funds and their long-term effectiveness. Flood zones where homebuyers seek loans should be expanded to at least the 500-year zone, using not local hydrologic records as the base line, but the most extreme regional rainfall event. If we expand the flood zones, there will be more policy holders, meaning each can pay lower rates, while the total underwriting pool will grow. By using the more extreme precipitation event—the regional record no one wants—homeowners will be less likely to be surprised by extraordinary rainfall.

Also, policies should encourage victims of flooding to relocate to safe areas rather than rebuild in harm’s way. This could be achieved by offering lower rates for those who opt for a policy that pays for relocation and not rebuilding in place. Or, imposing a substantially higher rate to insure a rebuilt home in a location that was flooded is another option.


More importantly, municipalities should set aside their urge to permit development in enlarged flood zones. Limiting public works infrastructure to areas subject to floods can deflect inappropriate development. But if development is inevitable, cities and counties can insist that developers set aside an escrow account to subsidize future flood recovery. Rather than permitting the subdivision of risk to individual homeowners, the developer should retain a portion of the risk normally subtly shifted to property buyers.

Floods can be expected in low-lying areas of the Gulf Coast. When there is insufficient slope to swiftly carry excessive rainfall to the sea, it spills out of the creeks and bayous into homes and businesses. Copious rainfalls have become more common, not less. Heavy rains should be the expected, not the unexpected. Planning accordingly will help sustain the insurance program, lower disaster relief expenditures in the long run, and more importantly, minimize the uninsured trauma and suffering.

Craig E. Colten is the Carl O. Sauer Professor of Geography at Louisiana State University and author of Southern Waters: The Limits to Abundance (2014).