The National Association of Insurance Commissioners (NAIC) has shared the results of its recent national survey, which found that while a considerable number of Americans support the idea of flood insurance, only a small percentage of those people actually purchased the insurance.
About 1,000 American adults participated in the survey, which was conducted last month.
The survey found that 41% of respondents agree or strongly agree that flood insurance is a “good idea.” Despite this, only 17% said that they have purchased flood insurance.
NAIC even suspects that some of the survey’s respondents who said that they have purchased flood insurance may have misunderstood what their policy actually covers, since by default most regular homeowners’ insurance policies do not cover flood damage.
To support this notion, the association cited data from the Federal Emergency Management Agency (FEMA), which estimated that only about 3% of homeowners have flood insurance.
“This disparity perhaps reflects the common, though incorrect, assumption that homeowners’ insurance covers flooding,” commented NAIC president and Maine Bureau of Insurance superintendent Eric Cioppa.
The survey also had several key findings about those within the Millennial age group (those born between 1981 and 1996), mainly that they are the group most likely to purchase flood insurance:
- Millennials are nearly three times more likely to have purchased flood insurance than their Baby Boomer (those born between 1944 and 1964) counterparts.
- Millennials are more likely than their Gen X (those born between 1965 and 1980) counterparts to purchase flood insurance (25% vs. 16%).
- Millennials are more likely to agree/strongly agree that purchasing a flood policy is a good idea (57% vs. 41% for Gen X vs. 24% for Baby Boomers).