Global sea levels have risen by nearly eight inches since 1880 and could rise another one to four feet by 2100, according to the National Climate Assessment.

Considering five million Americans live within four feet of local high-tide levels and events like storm surge, high drought and flash flooding are all on the rise, many of your clients may not be fully prepared for impending flood risks.

“There’s this perception in America, this decision bias where people think it’s not going to happen to them, but it does,” says Greg Knuffke, assistant vice president of analytics and product development at National Flood Services.

In fact, homeowners with Preferred Risk policies who live in locations where flood insurance is not mandatory actually account for 20% of FEMA flood losses—“suffering losses that far outweigh those that are inside of the mandatory flood areas,” Knuffke says.

Expect the Unexpected

While flash floods, heavy rains and hurricanes constitute the most expected flood risks, Knuffke points out two that may not be as obvious. Consider June’s flash flooding in Colorado, a result of erosion and wildfire.

“If you’re in California today, you probably think, ‘There’s little chance that I’m going to flood since we’re having the worst drought in 150-200 years,’” Knuffke says. “But the parched landscape will allow any subsequent rainfall to pose a higher risk of flash flooding because the ground will not absorb that water. That water will flow down that hill, and those at the bottom of the hill are going to be at serious risk.”

Another unexpected flooding scenario arises in the aftermath of heavy snowfall in the north that melts and swells rivers in its journey south—and related flooding is subject to a FEMA rule your clients may not know about.

“If you’re down south and the melting and the flooding of the Missouri river is 30 days or more in advance of you being hit, they mark the day that it originally starts to flood in the northern tier states as the inception date—the beginning date of this loss event,” Knuffke explains.

How to Help

Knuffke says there’s a misperception of how much flood insurance costs. But if consumers “recognize how affordable it is, I think a lot of independent insurance agents would probably have that discussion,” he says. “It’s easy to understand from an agent’s perspective. It doesn’t matter if you live in California or New Mexico—what matters is if you’re high-risk or low-risk, and that’s the main driver of the premium.”

Beyond educating clients, Special Flood Hazard area (SFHA) clients—property owners in high-risk areas that have a 25% chance of flooding during a 30-year mortgage—may be the prime demographic for independent agents to focus their efforts.

“There’s probably 100% opportunity to grow the SFHA market just by helping people understand what their risk is and finding those people that don’t have the insurance that they need,” Knuffke says, noting that average coverage costs are $1,400 and rising.

As the private flood market gains traction in the aftermath of Biggert-Waters and the Homeowner Flood Insurance Affordability Act of 2014, independent agents have more options for protecting their insureds.

“This is an ever-evolving world, and with private companies entering the space, I think you’re going to see a lot of competition and for responsibility for protecting your home and more products,” Knuffke says. “The whole industry will evolve. By 2050, this is going to become a lot more serious loss event.”

Morgan Smith is IA assistant editor.