The glib response is to blame the severity of these catastrophes on climate change, but are we looking in the wrong direction?
Despite the inability to hedge risk, people continued to move into flood-prone areas.
Not having insurance put owners on the hook for expenses in rehabilitating a flooded home.
"Lloyd's is actively pursuing the further development of the private flood insurance market in the USA, which will help to promote flood insurance and encourage more people to take up cover". The National Flood Insurance Program was established in 1968 to address the lack of availability of flood insurance in the private market and reduce the demand for federal disaster assistance for uninsured flood losses. Because of major storms like Katrina, Sandy and Matthew, the NFIP is $25 billion in debt to the government.
The group says thousands of homeowners affected by Hurricane Sandy, one of the costliest hurricanes in USA history, still haven't been paid what they're owed five years after the storm ravaged the East Coast. In flood zones, lenders typically require flood insurance. Instead, the newly created Flood Insurance Administration attempted to launch the program on a national scale with insufficient resources.
The National Flood Insurance Program's activities are funded largely by the premiums and fees paid by its policyholders, supplemented by a small amount of general funds to help pay for flood risk mapping. For example, wetlands are lost to distorted growth. Those who suffered wind damage, will make claims under their homeowners insurance which comes from private companies. But Houston's low-lying flatlands keep booming.
With a National Flood Insurance Program policy, a homeowner can purchase coverage on a dwelling up to US$250,000 and the contents of a home up to $100,000. According to the Federal Emergency Management Agency, mitigation projects already save more than $1 billion in prevented damages each year, with every dollar spent on mitigating natural disasters saving $4 in costs borne by society later on.
Despite the unprecedented scale of this disaster, we fear that those who are calling Harvey a once-in-a-generation event are wrong.
"The problem is that we are all at risk", he said. If your agent can't help you, contact your insurance company.
If you have a history of drunk driving, that increases the chances you'll make an insurance claim on your auto - so your premiums will be higher, and that encourages you not to drive in the future (or to drive sober in the first place).
If you bought a fancy sports auto, that would increase the loss to the company if your vehicle gets damaged - so your premiums would be higher. That might encourage you to buy a less-expensive vehicle.
If the risk is high, premiums will be prohibitive.
Another way Louisiana consumers could be affected has to do with comprehensive coverage provided as part of their auto insurance policy. comprehensive covers flooding of cars so McCarty says people may see some rate increases. But they pay rates far lower than the risks warrant.
Unfortunately, the prospects for reform are low. Last week, Congress gave the flood program a three month lifeline to allow it to process and payout new claims. The two main reasons are that the cost of premiums has increased, and in 2014 a surcharge was added for homes that are not the policyholder's primary residence, he said. And a big factor in the low cost of housing in the Houston area is that developers are free to build nearly anywhere, including marshy, low-lying areas where land is cheap.