Lloyd Dixon

The Cost and Affordability of Flood Insurance in New York City: Economic Impacts of Rising Premiums and Policy Options for One- to Four-Family Homes

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How Affordable Is Flood Insurance in New York City and What Can Be Done to Address Affordability Issues

• Moving forward on any option requires answering a number of questions. Hurricane Sandy struck New York City on October 29, 2012, with devastating consequences—highlighting the importance of programs and policies that promote greater resilience. Flood insurance is an important part of this resilience strategy, but as in other parts of the country, coverage is inconsistent among oneto four-family properties in New York City and is difficult for some households to afford. Compounding this challenge is congressional direction to phase out certain long-standing subsidies in the National Flood Insurance Program (NFIP), the primary source of flood insurance for oneto four-family properties nationwide. Additionally, increasing risk from flooding and the resultant ongoing efforts to update the city’s flood maps will likely result in higher flood insurance premiums for many households. Given this context, the New York City Mayor’s Office of Recovery and Resiliency asked the RAND Corporation to study the issue, and researchers sought to answer four questions, with a focus on oneto four-family homes in areas that are at high risk of flooding: