Differential flood insurance participation and housing market trajectories under future coastal flooding in the United States

Abstract

Communities respond to flooding events based upon risk perceptions and available adaptive behaviors (e.g., emigrating, purchasing insurance, constructing levees). Across the United States, sea level rise, intensifying storm-surges, and extreme rainfall may alter human-flood dynamics. Here, we use calibrated Socio-Environmental models of contiguous US coastal census tracts and two shared socio-economic pathways (SSP245 and SSP585). We project that by 2100, total flood insurance claims will increase by +25% to +130% under low (SSP245) and high (SSP585) emissions scenarios, respectively. The increase in flood insurance claims will impact mainly socially vulnerable communities. Further, we project that active NFIP policies will increase from +30% under low emission scenario to +60% under high emission scenario. Our finding also suggests the growing debt of the National Flood Insurance Program under higher emissions. Raising the water elevation threshold for coastal flooding by +1 meter via levees may reduce future surge-related losses by 95% and 40% under low and high emission scenarios and stabilize housing markets. Our future projections of flood insurance claims, policy coverage, and the impact of water elevation serve as credible hypotheses for the evolution of human flood dynamics under climate change. They can inform national flood policy and future research. By 2100, total flood insurance claims and policy coverage are projected to increase under high emission scenario, and it will disproportionally impact most vulnerable communities in coastal areas of the US, according to an analysis that uses a socio-environmental model and climate scenarios.