Assessing community flood adaptation capacity to reduce flood losses

Abstract

Flooding constitutes the largest proportion of economic losses from disasters in the US and is poised to become the main driver of disaster-driven economic loss worldwide. Community level flood planning has the potential to alleviate part of the problem. The US Community Rating System incentivizes community floodplain management practices in exchange for flood insurance premium rate discounts. The main goal of the program is to reduce and avoid flood damage to insurable property. Using multi-period matching and difference in differences this paper explores whether and to what extent this goal is achieved. Contrary to past evidence, this assessment finds mixed evidence on the potential that participating in the CRS decreases flood losses for communities that join the CRS. Further research is required to explore whether the program contributes to increasing community resilience aspects beyond decreasing damage to insurable property, and to determine who benefits from flood loss reduction.