Natural disasters like Hurricane Ian could worsen economic inequalities

MEMPHIS, Tenn. — Flooding is one of the most common natural disasters in the U.S., but flood insurance is optional for most homeowners.

Now many who are recovering from Hurricane Ian are realizing they don’t have this kind of policy.

recent nationwide survey shows only about 27% of homeowners reported having flood insurance - that’s less than one in three!

But as extreme weather becomes more severe, some experts said middle-class communities are becoming more vulnerable.

“They’re going to be having to navigate, rebuilding, repairing and deciding what to do next, with far fewer resources than they might have had with flood insurance coverage,” said Anna Rhodes, assistant professor of sociology at Rice University.

Getting flood insurance can be expensive.

FEMA estimates the typical flood policy costs about $700 a year with an average claim payout of around $52,000.

Professors Rhodes and Max Besbris from the University of Wisconsin-Madison found several disparities after examining recovery efforts from Hurricane Harvey.

Rhodes said households who had flood insurance ahead of the storm often had higher incomes compared to those who didn’t have policies.

She said people without insurance can apply for FEMA assistance, but those homeowners are offered much lower payouts.

“Flood insurance coverage can be up to $350,000 - $250,000 to repair the property and $100,000 for contents if you max out your policy, and households without flood insurance coverage could only receive a maximum of $33,300 in FEMA assistance,” said Rhodes. “So, there was just a really large difference in the financial starting points of those households.”

Sometimes homeowners get a government loan to cover repairs, but Rhodes said that can lead to major debt.

She calls this a pattern of growing inequities.

“Where the most advantage households become more advantaged in the aftermath of a storm and the disadvantage, households often become more disadvantaged,” said Rhodes. “That’s true in the hardest hit communities which are likely to be disadvantaged communities from the start.”

Rhodes said she wants FEMA and state and local agencies to improve outreach to homeowners and consider new strategies to shift people away from vulnerable coastal areas.

Right now, you’re only required to have flood insurance if you’re in a FEMA-designated flood zone.