As residents in Florida brace for the impact of the coming Category 5 storm Hurricane Milton, among their many concerns may also be a lack of insurance protections.Many are looking to residents in western North Carolina and other southeastern states that are still picking up the pieces from another Category 4 storm Hurricane Helene which hit on Sept. 26. 

It's been all the more challenging as the majority of property owners impacted by Helene were not covered by private insurance or with the National Flood Insurance Program.

The damage caused by Helene is estimated to cost property owners between $30.5 billion and $47.5 billion, with uninsured flood losses ranging from $20 billion to $30 billion, according to the data analytics firm CoreLogic.

Standard homeowners' insurance policies typically do not cover flood damage. To be insured, homeowners must purchase a separate policy or through the National Flood Insurance Program.

Of those properties in the United States that are at risk of flood, 92 percent were not covered by the National Flood Insurance Program, as of May 2023, according to a Congressional Budget Office study.

This insurance gap is only expected to grow as states deal with the impacts of climate change. In 2023, multiple weather and climate records were broken, including July’s warmest temperatures in the 174-year history of the National Oceanic and Atmospheric Administration.Since 1980, weather and climate-related disasters have caused an estimated $2.6 trillion in losses.

The problem is exacerbated by insurance companies inflating premiums due to the rising demand for coverage in the face of natural disasters."Insurance regulation ensures that insurers remain solvent to pay for claims. This means they need more premiums and capital to ensure they have enough money to pay future losses," Charles Nyce, a professor of risk management and insurance at Florida State University’s College of Business, told Salon in a recent interview.

Nyce offers a grim forecast, noting that higher premiums will disproportionately impact less wealthy individuals, who are least able to afford the additional costs.

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