Year: 2026
Type: article
Abstract: Flooding is a major risk to human health and wellbeing and is an important cause and consequence of population redistribution. After decades of concern about outdated risk assessments and actuarially unsound pricing structures, in 2021 the U.S. National Flood Insurance Program (NFIP) implemented a new methodology for risk-rating—the translation of estimated flood risk into insurance premiums—with the aim of aligning premiums with risk-based pricing. The new rating methodology is expected to result in significant premium changes for some properties, but the distributional impacts have not yet been assessed. This study investigates the impact of NFIP risk-rating reforms at the ZIP code level in New York State, focusing on their effects on flood insurance costs and flood insurance purchases. The study empirically examines how NFIP premium changes vary across ZIP codes and how rates of flood insurance purchase change in response. Results show regionally differentiated impacts. Upstate, the average projected premium increase is 30% points higher than downstate, and premiums are projected to increase more in rural areas with lower incomes. Downstate, projected premium increases are higher in areas with higher proportions of White homeowners. Insurance purchase rates declined more in areas with higher projected price increases, and price sensitivity was greater in downstate than upstate. This study provides a first assessment of the impact of the new NFIP risk rating methodology in New York and highlights the importance of regionally differentiated analyses for accurately assessing patterns of policy impact across populations and identifying context-specific policy implications.
Source: Population and Environment
Institution: Cornell University
Language: English
Subfield: Global and Planetary Change
Field: Environmental Science
Domain: Physical Sciences
Open Access status: hybrid
Estimated APC paid: $2,890
OpenAlex ID: W7214456019