Journal Article

Examining Flood Insurance Claims in the United States: Six Key Findings

Oct 23, 2015 | Carolyn Kousky, Erwann Michel-Kerjan


We undertake the first large-scale analysis of flood insurance claims in the United States, analyzing over 1 million claims from the federally managed National Flood Insurance Program (NFIP) over the period 1978–2012. Using fixed effects regressions and other statistical analyses, we test several hypotheses about the nature and drivers of flood claims (e.g., the impact of flood zone, characteristics of the house, individual and collective mitigation, and repetitive loss properties), as well as uncover quantitative relationships on the determinants of claims payments. We also examine how claims are distributed across time and space. Our findings, several surprising, provide a quantitative basis for exploring the challenges associated with low insurance demand and also can contribute to more informed policy decisions regarding reform of the NFIP, as well as flood insurance markets around the world.