West Coast
A washed-out road as Tropical Storm Hilary hits Palm Springs, California, on Aug. 20.Photographer: David Swanson/AFP/Getty Images

CA - California Got a Wake-Up Call on Flood Risk From Storm Hilary

When Tropical Storm Hilary slammed into the normally dry state, it showed nowhere is immune to flooding as global warming fuels extreme weather.

Californians know wildfires and earthquakes; hurricanes, not so much. So when Tropical Storm Hilary inundated Southern California  in normally bone-dry August, it showed just how exposed homeowners are to a growing financial risk from unpredictable climate-driven flooding.

Standard homeowners insurance policies don’t cover flooding and fewer than 2% of California households have flood insurance, even as intensifying winter storms  overflow rivers and levees, batter the coast and drench the desert. As Hilary, the first tropical storm to strike the Golden State in 84 years, passed over Palm Springs on Aug. 20, it dumped nearly a year’s worth of rain  in a day on the desert community east of Los Angeles, causing widespread flooding in the surrounding Coachella Valley..

“Nowhere is safe from flooding in California today,” says Firas Saleh, director of product management at risk modeler Moody’s RMS. Even communities far from rivers and the coast face increasing peril. “Rainfall can happen anywhere,” adds Saleh, who analyzes climate-related flood risk. “That means that these areas are becoming more and more vulnerable to flooding because of the change in the frequency and intensity of rainfall.”

Here’s what to know about flood risk and options to mitigate that exposure.

Why so few Californians have flood insurance

When you buy a house, the lender will check maps published by the Federal Emergency Management (FEMA) to see whether the property sits in a flood zone designated as high risk by the government. If so, the lender may require you to obtain coverage through FEMA’s National Flood Insurance Program or from a private insurer. If you have a federally insured loan and live in a hazard zone, flood insurance is mandatory. Your home may also be located in a zone FEMA identifies as at lower risk from flooding.

But given California’s exorbitant home prices and rising insurance rates, many homeowners forgo flood insurance absent a requirement to purchase polices, according to Saleh. Even those who must buy flood insurance to obtain a mortgage may cancel in succeeding years, betting their lender won’t notice. California’s record-breaking, three-year drought, which only ended with the past winter’s record-breaking storms, may have also made flooding seem like a distant threat.

The National Flood Insurance Program writes 89% of residential policies in California though private insurance accounts for 42% of premiums paid, according to Moody’s RMS, due to the higher value of those policies. But federal coverage rates are falling, with a 5% decline nationwide since 2021 “We’re seeing a lot of cancellations over the last two years,” says Saleh.

Among Palm Springs’ nearly 24,000 households, just 167 were covered by federal flood insurance as of July 31, according to FEMA data. In the Northern California coastal town of Capitola, which saw its wharf wash away and homes flood last winter, only 66 of its 4,656 households have federal flood insurance.

Read More: Hurricane Idalia Exposes Florida’s Dangerous Flood Insurance Gap

Michael Soller, a deputy commissioner at the California Department of Insurance, said in an email that the state “has been working to increase consumers’ awareness of flood insurance protection gaps.”

Flood maps don’t reflect today’s climate risks

FEMA taps historical, meteorological and topographic data to determine the likelihood of flooding from waterways as well as from storm-driven waves in coastal areas.

But the accelerating pace of climate change has outstripped those assumptions. That’s particularly true in California, which has swung between extremes of drought and deluge over the past decade. A tropical storm hitting California in the dead of a hot and dry summer probably was not on FEMA’s flood-probability bingo card.

Read more.