Fewer Californians Buying Flood Insurance Despite Record-Breaking Year

California federal flood claims topped $59M in 2023.

Evelyn Pimplaskar
Evelyn PimplaskarEditor-in-Chief, Director of Content
  • 10+ years in insurance and personal finance content

  • 30+ years in media, PR, and content creation

Evelyn leads Insurify’s content team. She’s passionate about creating empowering content to help people transform their financial lives and make sound insurance-buying decisions.

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John Leach
Edited byJohn Leach
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John LeachSenior Insurance Copy Editor
  • Licensed property and casualty insurance agent

  • 8+ years editing experience

John leads Insurify’s copy desk, helping ensure the accuracy and readability of Insurify’s content. He’s a licensed agent specializing in home and car insurance topics.

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Published April 29, 2024 at 5:00 AM PDT | Reading time: 2 minutes

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Flood insurance claims in California soared nearly 211% in 2023, reaching an all-time high of more than $59.3 million, according to National Flood Insurance Plan (NFIP) data. And despite severe flooding and storms that caused nearly $5 billion in damages last year, the number of Californians with NFIP policies decreased in 2023.

The rising cost of flood and homeowners insurance in California could be a factor in homeowners’ decision to forgo flood insurance.

Rising insurance costs

Managed by the Federal Emergency Management Agency, the NFIP is the largest provider of flood insurance in the country. FEMA implemented a new pricing structure in 2023 that caused NFIP premiums to increase by $10 or more per month for about 73% of California policyholders. Nearly 4% saw their monthly premiums rise by $20 or more.

Standard homeowners insurance policies don’t cover flooding — homeowners needing flood coverage must buy a separate flood insurance policy. Those with federally backed mortgages in zones FEMA has designated as high-risk are required to purchase NFIP coverage.

But homeowners with federally backed loans who aren’t in a high-risk zone, those with conventional mortgages, or those with paid-off homes aren’t required to buy flood insurance. And many don’t.

Meanwhile, a shrinking pool of home insurers and an increasing number of severe weather and wildfire threats are pushing home insurance costs higher in the Golden State. The average annual cost of homeowners insurance in California was $1,782 in 2023, according to Insurify data. And Insurify’s data analysts predict rates will rise another 8% in 2024.


Rising flood risks

More than 7 million Californians are at risk for flooding, and in the past two decades, every county in the state has experienced a flood-related emergency, according to the California Department of Water Resources (DWR).

Last year was also a historic one for weather threats in the state.

California had multiple instances of heavy rainfall that led to severe flooding in 2023. In January, a storm that brought heavy rains, high winds, and large coastal waves caused massive flooding on the state’s central coast. February then saw record rainfall in portions of Southern California. And in August, the state experienced its first-ever tropical storm watch, and Hurricane Hilary caused record-breaking rainfall and flooding in the Southwest.

Los Angeles alone got more than 29 inches of rain — 207% of its normal amount.

“Climate extremes are creating more challenges for California, including increasing flood risk across the state,” Karla Nemeth, DWR director, said in an October 2023 statement.

What’s next: Higher risk, fewer protected

California’s massive 2023 NFIP claims payout amount stemmed from just 1,085 claims. The year’s flooding affected thousands of homes and businesses in the state.

Despite last year’s billion-dollar flood damages, California experienced a 1% decline in the number of NFIP policies in force. As of mid-April 2024, 1,934 fewer NFIP policies were in effect in California.

“Flood insurance is available through the Federal Flood Insurance program and must be in force for 30 days prior to a flood,” the state’s Department of Insurance says. “Experts are suggesting consumers, including those in traditionally low-risk areas, consider purchasing flood coverage before warm weather begins to melt the snow.”


Evelyn Pimplaskar
Evelyn PimplaskarEditor-in-Chief, Director of Content

Evelyn Pimplaskar is Insurify’s director of content. With 30-plus years in content creation – including 10 years specializing in personal finance – Evelyn’s done everything from covering volatile local elections as a beat reporter to building fintech content libraries from the ground up.

Before joining Insurify, she was editor-in-chief at Credible, where she launched and developed the lending marketplace’s media partnership’s content initiative and managed the restructuring of the editorial team to enhance content production efficiency. Formerly, as tax editor for Credit Karma, Evelyn built a library of more than 300 educational articles on federal and state taxes, achieving triple-digit year-over-year growth in e-files from organic search.

Her early career included work as a content marketer, vice president and managing officer of a boutique public relations agency, chief copy editor for 14 weekly Forbes publications, reporting for large and mid-sized daily newspapers, and freelancing for the Associated Press.

Evelyn is passionate about creating personal finance content that distills complex topics into relatable, easy-to-understand stories. She believes great content helps empower readers with the information they need to make important personal finance decisions.

John Leach
Edited byJohn LeachSenior Insurance Copy Editor
Photo of an Insurify author
John LeachSenior Insurance Copy Editor
  • Licensed property and casualty insurance agent

  • 8+ years editing experience

John leads Insurify’s copy desk, helping ensure the accuracy and readability of Insurify’s content. He’s a licensed agent specializing in home and car insurance topics.

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