Skip to content

Why coastal flooding is essentially uninsurable.

  • by
  • 2 min read
coastal flooding ©"coastal flooding 2" by NHSeaGrant is licensed under CC BY-ND 2.0. To view a copy of this license, visit

“Because of the greater risk surrounding coastal flooding, offering standalone coastal flood insurance could be fatal for an insurer. Further, simply folding coastal into a larger flood insurance/comprehensive water policy would likely require greatly imbalanced cross-subsidization between, say, a homeowner paying a flood premium in a downtown urban address that is away from a river and someone living right on the coast in, say, Atlantic Canada.”

“The main issue with assets located on a coast is that, although all won’t necessarily certainly flood, many will; and, over time, many will flood repeatedly. For some properties, the certainty is close to 100%; thus, the fortuitousness or randomness would be all but gone. Then the policy has stopped becoming one of insurance and has become one of maintenance, which flies in the face of the basic tenets of insurance and concepts of insurability. The “sudden and accidental” becomes “regular and expected” or predictable. insurable, the loss must be random (i.e., it may or may not occur in the future). This is key, because a homeowners insurance policy is not a property maintenance contract or a warranty.”

It is not sustainable for governments to keep replacing assets through disaster recovery that are going to be destroyed by sea level rise or increased overland flooding. Disaster recovery is neither an insurance policy, property maintenance contract nor warranty. It was meant for the “once in a lifetime” event that is now becoming a regular occurrence.