US economic losses from the recent California flooding could reach US$5-7bn, according to estimates from Moody’s, whose forecast reflects inland flood impacts for the US and includes damage to infrastructure.
Insured losses are anticipated to be between US$0.5-1.5bn, including losses to the National Flood Insurance Program and the private flood market.
The overall economic loss estimate is based on an event reconstruction using the Moody’s RMS US Inland Flood HD Model and reflects property damage, contents, and business interruption, across residential, commercial, industrial, automobile and infrastructure assets.
The number of households in California with flood insurance stands at less than two per cent – a figure that has been steadily declining. As of August 2022, there were only 193,281 residential National Flood Insurance Program (NFIP) policies in place, representing a decline of around five percent as compared with 2021.
“Nowhere is safe from flooding in California today,” commented Firas Saleh, director, product management of Moody’s RMS. “If we’ve learned anything from this extreme rainfall and subsequent damage, it’s that even perceived low-risk flood zones are still flood zones. If it rains, it can overflow.”
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