In regard to your article, "FederalFlood Insurance is a Winner, Warts and All"(Risk &
Insurance®, July/August 2012, Page 54) you state, "Improving the flood insurance program is a political not a technical issue, and the answer isn't to automatically turn to the private sector."
I respectfully disagree that improving the program is very much a technical issue. The hydrologic studies (probabilistic analysis of river discharges) used in the modeling and mapping are, on average, 20 to 30-plus years out-of-date.
Also, according to the Federal Emergency Management Agency library, 80 percent of the models are in paper format and use a 1980's computer model.Using old data on new digital maps with aerial images, in my opinion, was a waste of time and resources.The federal government really needs to allocate the funds and manpower, whether internally or through contractors/consultants, to update the studies.Given that FEMA does not have adequate staff to do this work, I feel that they should turn to the private sector (consultants).
As a water resources engineer, I feel that updating the flood studies may likely result in higher flows and increased flood elevations in many areas and that politically, this is an issue giving our leaders a strong reason not to allocate the funds to adequately represent the risk.
As you note in your article,the Government Accountability Officereportsthat 50 percent of all flood insurance claims are made from those outside the mapped floodplain. That alone should tell the industry that the maps are inadequate and need of reform.
Any community which participates in the National Flood Insurance Program (NFIP) is required to enact and enforce regulations which prevent development in a mapped floodplain. The number of propertiesleft inhigh hazard areasshould be stable or reduced over time, given programs such as buyouts, substantial damages reconstruction requirements, etc. Local governments typicallydo notconduct their own flood studies and rely on FEMA's maps to show where the risk lies. They can only enforce what the maps depict, and if the maps do not represent thetrue risk, we are selling ourselves short.
I agree, overall the NFIP has been a beneficial program and was overstretched with the 2005 hurricane season. The program has laid a good foundation but requires updated information. Many of the flood studies do not accurately represent the rainfall and flooding potentialfrom tropical systems, which contributes to the majority of widespread flooding.
Politically, raising flood risk and potential flood elevations, particularly in the coastal regions, would be a very unpopular and costly move. In my opinion, federal and local government avoiding thetrue risk only hurts everyone in the long run, with rate increasesand program debt.
NFIP reform may shift some of this burden to the private insurance industry. I recently was employed by a reinsurer whose goal was to adequately model the flood risk for the entire country, but gave up the project in frustration, as it required significant resources and timeto create or bring every flood model up-to-date.Private insurance currently relies on the government to provide the flood risk but I doubt the private sector will feel comfortable hedging their losses using 20 to 30-year-old data.
Water Resources Engineer
Castle Rock, Colo.
September 15, 2012
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