Flood insurance reform long overdue Editorial: Long-overdue flood insurance reform should encourage resilience, improve fairness

Changes to the National Flood Insurance Program, which took effect Oct. 1, are long overdue, but they are likely to result in higher costs for a great many Virginia residents and businesses who live in at-risk areas.

That's fair, if unfortunate, since those in high-risk areas should pay their share. But the real benefit of these reforms is to encourage community-, local- and state-level resilience, which can lower premiums and better protect property (and, by extension, lives).

Extreme weather events responsible for destructive flooding are more frequent with each passing year. Climate change makes them more severe and harmful, and threaten property once thought safe from danger.

By changing the pricing model to take more factors into account - the most profound program changes in decades - homeowners will be expected to pay premiums more in line with their particular risk and potential cost to taxpayers.

Under the old system, premiums often depended on outdated flood maps and a rudimentary calculation of risk. It meant that some people who purchased policies paid far too little for insurance through the program while others paid too much.

Those standards were adopted in the 1970s. Since that time, average global temperatures have risen about 0.3°F in each decade. Atmospheric carbon dioxide measured at the Mauna Loa Observatory in Hawaii was 325.68 ppm in 1970 and reached 419 ppm this summer, the highest figure in more than 60 years of study.

In short, it is a vastly different world now. Temperatures continue to increase, seas continue to warm, flooding is growing more frequent, widespread and destructive. Adjusting for those factors makes practical sense and is a responsible move by the federal government.

The new system, called "Risk Rating 2.0," will take into account a number of factors in setting the premium, such as distance to a body of water, flooding frequency, type of building and, importantly, what resilience measures are in place to mitigate damage.

No need to sugarcoat it: That won't be great for plenty of Hampton Roads residents, especially those who own valuable property in flood-prone areas. About 48% of policyholders are expected to see increased premiums, according to FEMA.

But it will be cheaper for many others; about 47% will see immediate decreases in their premiums. And property owners won't be asked to swallow that huge jump in pricing all at once. The law limits annual premium increases to 18% so it will take several years before the changes are fully implemented.

By taking resilience improvements and other mitigation measures into account, the program will emphasize those investments - not only by individual property owners, but by communities, municipalities and states.

For instance, FEMA says that policyholders may acquire an elevation certificate, to provide more refined elevation information that could lower one's premium. It points to pre-hazard mitigation grants available to communities, and state-level grants to prepare at-risk areas for disasters.

If there's one glaring hole in the messaging around this, it's in regard to low-income residents of high-risk areas. So much so-called "affordable" housing options occupy land that floods frequently, putting residents and property owners in danger. Higher premiums should not serve as yet another barrier to affordable housing.

Otherwise, reform of the NFIP represents a move toward fairness, especially for the American taxpayer.

According to a report this year by the National Academy of Sciences journal, intensifying precipitation was responsible for a total of $75 billion in U.S. flood damage between 1988-2017. Total flood damage in those years was nearly $200 billion, meaning about one-third of the total flood damage could be linked to climate change.

The federal government has long accepted responsibility for helping those harmed by natural disaster, a role it should continue to play. But it's reasonable to expect that insurance rates are fair for those who live in frequently flooded areas along the coast, and that the program reward efforts to make individual properties, communities and states more resilience and prepared.