Helene Was Ruinous. The Insurance Reality Is Worse

The devastation Hurricane Helene caused may be followed by devastation of another flavor: financial. Politico reports homeowners' insurance generally does not cover flood damage, which must be purchased separately. Almost all of US flood policies are sold via the Federal Emergency Management Agency's National Flood Insurance Program, which covers 4.6 million homes and businesses. NBC News took a look at how widespread flood insurance is in the areas hit hardest by Helene, and the answer is so low it's barely appreciable.

• Less than 1% of residences in the North Carolina counties hardest hit by Helene were covered; in the worst-hit South Carolina counties it was even lower, at 0.3%.
• When factoring in Florida and other locations, about 2% of residences in the 100 counties that suffered the worst Hurricane Helene-related power outages are covered by flood insurance.
• USA Today cites a FEMA estimate that puts the number of American homeowners who have flood insurance at just 4%.

NBC News landed on those figures using Census Bureau data, PowerOutage.us data, and National Flood Insurance Program policy data collected by the insurance company Neptune Flood. Neptune Flood CEO Trevor Burgess elaborates: "These people are just left with a complete loss," which "creates this sort of spiral of economic hardship that is very difficult for all but the wealthy to recover from." USA Today notes Hurricane Katrina caused an estimated $125 billion in damage, not adjusted for inflation—but much of the destruction was caused by wind damage, which was covered. In this case, storm surge and flooding are the issues.

As for why the coverage is so minimal, Burgess shares his theories: "The No. 1 reason is that people mistakenly think that they're not in a high-risk flood zone, that they don't need it. No. 2 is confusion, that they believe that their homeowners insurance covers the risk of flooding when it does not. And No. 3 is the cost." FEMA does provide some financial assistance, but Politico notes it usually amounts to just a few thousand dollars. The Department of Housing and Urban Development has in some cases made billions of dollars of disaster aid available to homeowners, but the money usually isn't distributed for two to three years. (More Hurricane Helene stories.)