Collapse From Storm Surge—Will National Flood Pay These Claims?

Champlain Towers was a warning for aging condominiums to inspect and immediately repair structural compromises. Hurricane Nicole made another warning last week for structures along beach fronts—will the structures be able to withstand rising sea levels and storm surge?

A New York Times article went to the point:

As of Friday evening, Volusia County had ordered the evacuation of 27 condominiums and hotels, 22 of them in Daytona Beach Shores and five in New Smyrna Beach. They had been compromised by broken sea walls and water intrusion, leading authorities to evacuate thousands of residents, according to county officials. An additional 30 homes in Wilbur-by-the-Sea, an unincorporated community just south of Daytona Beach Shores, were teetering on the edge of the dunes.

These condominiums and hotels were not structurally questioned and then evacuated because of wind damage from Category One Hurricane Nicole. Prior beach erosion from Hurricane Ian and storm surge from Hurricane Nicole are the first short-term causes of the damage. The rising sea level is the long-term secondary cause.

Flood insurance is the obvious coverage that most think about when these losses occur. But will the National Flood Insurance Program pay for these losses?

Look at this language:

We do not insure for loss to property caused directly by earth movement even if the earth movement is caused by flood. Some examples of earth movement we do not cover are:

1. Earthquake;

2. Landslide;

3. Land subsidence;

4. sinkholes;

5. Destabilization or movement of land that results from accumulation of water in subsurface land area; or

6. Gradual erosion.

We fought many of these insurance coverage battles in Hurricane Katrina, Hurricane Ike, and Superstorm Sandy. We noted that New York’s Governor came up with a financial assistance program after Superstorm Sandy in Governor Cuomo Announces Plan to Compensate Victims of Superstorm Sandy Denied Coverage Based on FEMA Regulation:

Many Sandy victims were prevented from recovering on their flood losses in spite of having flood insurance under the National Flood Insurance Program (NFIP) on the basis of what is commonly known as the “earth movement” exclusion. This exclusion, which can be found in Paragraph C in the Exclusions section of each Standard Flood Insurance Policy (SFIP)….

Thus, damages caused by the movement of earth or soil are not eligible for coverage under the NFIP even if the movement was directly caused by flood. As a result of this exclusion many Sandy victims have been displaced and unable to rebuild their homes.

Governor Cuomo’s home rebuilding program seeks to redress this gap in coverage by providing rebuilding costs not covered under the FEMA plan. The program will be financed by federal hurricane grants and will provide much needed funding directly to eligible homeowners.

I have no idea why we arguably allow the National Flood Program not to cover hurricane storm surge under these circumstances. I cannot predict the future, but the past warns of what may happen. This is another example of the need for reform of our national flood program.

Thought For The Day

The thing that lies at the foundation of positive change, the way I see it, is service to a fellow human being.
—Lech Walesa

Song For A Flood