"We've been underpricing risk in this nation so long, we've built this dynamic now where people have built and live in areas that are increasingly vulnerable to these disasters," Craig Fugate, a former FEMA administrator, said. Credit: bilanol/Adobe Stock
(Bloomberg) — When disaster hits in the U.S., the federal government gives aid to states and counties as well as individuals. In 2022, the Federal Emergency Management Agency delivered $3.25 billion to nearly 1.4 million households recovering from damaging floods and fires. The aid money helps cover things as large as home repairs and as small as diapers, drinking water, food and other necessities.
This aid regime was created by Congress: The Stafford Act of 1988 threw a lifeline to Americans who were not covered by private insurance, a group assumed to be small. But that can no longer be taken for granted. Insurance rates are rising as costly disasters become more frequent, and with more and more people living in higher-risk areas such as coastal Florida and wildfire-prone parts of the West. Insurance companies are now stepping back from some markets. Just earlier this week, The Hartford announced it would become the latest major insurer to stop writing new policies in California.
Want to continue reading?
Become a Free PropertyCasualty360 Digital Reader
Your access to unlimited PropertyCasualty360 content isn’t changing.
Once you are an ALM digital member, you’ll receive:
- Breaking insurance news and analysis, on-site and via our newsletters and custom alerts
- Weekly Insurance Speak podcast featuring exclusive interviews with industry leaders
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical converage of the employee benefits and financial advisory markets on our other ALM sites, BenefitsPRO and ThinkAdvisor
Already have an account? Sign In Now
© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
