WASHINGTON -- As of Nov. 10, the National Flood Insurance Program (NFIP) has received more than 44,000 flood claims from Hurricane Ian and has paid nearly $437 million to policyholders.
FEMA’s initial estimate projects Hurricane Ian could potentially result in NFIP claims losses between $3.5 - $5.3 billion, including loss adjustment expenses. The losses include flood insurance claims received from five states, with the majority of claims coming from Florida.
The agency based the initial estimate on several data points. These include policy information, daily reports of claims and payments made, significant historical events patterns of reported claims and payments, current economic conditions and claim adjuster observations.
FEMA will continue to update models and confirm future estimates as the claims process evolves.
NFIP flood insurance claims are paid from the National Flood Insurance Fund and Reserve Fund. The program also has the ability to borrow an additional $9.9 billion in funds.
FEMA’s reinsurance program includes an annual traditional reinsurance program with a $4 billion or more trigger for a percentage of recovery payments and three capital market placements with a recovery payment beginning at $5.32 billion in received claims payments. To collect the maximum reinsurance amount, the NFIP would need to incur at least $10 billion in flood insurance claims losses. In addition, FEMA currently holds $2.49 billion of reinsurance coverage for fiscal year 2022. If a covered flood event results in NFIP claim payouts that equal or exceed an agreed upon amount, then reinsurers agree to pay a certain percentage.
The above comes from a FEMA News Article, link to source provided below.