The potential for flood insurance privatization in the US has been added to your bookmarks.
The potential for flood insurance privatization in the US
Could carriers keep their heads above water?
The National Flood Insurance Program (NFIP) is exploring the possibility of sharing more of its exposure with primary insurers, reinsurers, and alternative market investors. But it is up to private market players to determine the prospects for writing such coverage profitably, including how to overcome the challenges that have left the NFIP heavily in debt.
Is privatizing flood insurance worth the risk?
The National Flood Insurance Program (NFIP), which generates $3.3 billion in premiums, is exploring the possibility of sharing more of its exposure with primary insurers, reinsurers, and alternative market investors.
Although flood insurance may present a tremendous growth opportunity for private carriers, convincing them to get back into the flood insurance business in a big way will likely require concrete actions on the part of federal and state lawmakers to create an environment in which carriers are given enough flexibility to underwrite and price coverage for a reasonable return on the risks they are being asked to assume.
This report examines how private markets might play a bigger role in underwriting flood insurance risks, while assessing the possible obstacles facing those interested in taking on such exposures.
- Status Report: Where do NFIP reforms and privatization efforts stand now?
- Challenges in managing and financing flood risk
- Options and prospects for greater privatization of the exposure
- Where do carriers go from here with flood insurance?