FloodsFlood insurance program needs better approach to analyzing flood risk

In administering the National Flood Insurance Program, the Federal Emergency Management Agency (FEMA) needs a more modern approach to analyzing and managing flood risk behind levees — one that would give public officials and individual property owners a clearer idea of the risks they face and how they should address them, says a new report from the National Research Council.  Because levees can reduce but not eliminate the risk of flooding, the agency should also encourage communities behind levees to use multiple methods to reduce risk and increase awareness of these risks.

A National Research Council release reports that while purchasing flood insurance is an effective way for property owners behind levees to deal with financial risk from floods, at this time there is no sound reason to extend the mandatory purchase requirement — which requires property owners with a federally backed mortgage located in the 100-year floodplain to purchase flood insurance — to areas behind accredited levees, the report says. The mandatory purchase requirement has not been effective at achieving widespread purchase of flood insurance in areas of the floodplain without levees; extending it to areas with levees – where the level of flood risk for many properties is unknown and where the challenges of risk communication are great — would not be a prudent step. Once the modern risk analysis has been put in place and matures, FEMA should study whether the mandatory purchase requirement is necessary throughout flood hazard areas and behind levees.

The report responds to a request from FEMA, which asked the National Research Council to examine the manner in which levees are addressed in the National Flood Insurance Program. In recent years extreme storms and hurricanes have caused increasingly disastrous flooding along U.S. rivers and coastal areas, with much of the damage occurring when levees failed or were overtopped by water.

Properties that are located in 100-year floodplains but protected by an accredited levee system — one built to withstand a flood that has a 1 percent chance of happening each year — are exempt from the requirement to buy flood insurance. As FEMA began to modernize its flood maps in 2003, however, it became apparent that some accredited levees no longer met the standard of protecting against a “1 percent annual chance” flood. In establishing flood insurance premium rates, FEMA considers a non-accredited levee to be the same as no levee at