Flood insurance is a type of property insurance that provides coverage for losses caused by water damage specifically due to flooding. Floods are caused by heavy or prolonged rain, melting snow, coastal storm surges, blocked storm drainage systems, or levee dam failure. Flood insurance purchased through the National Flood Insurance Program (NFIP), in the U.S., provides up to $250,000 in building property damage and $100,000 in personal property damage.
One of the key drivers of the flood insurance market is an increase in the frequency and severity of floods. Furthermore, people have become more aware of the risks of flooding and the importance of flood insurance. This is due to better education and awareness campaigns by government agencies, insurance companies, and community organizations. Thus, the rise in awareness drives the demand for flood insurance, contributing to the flood insurance market growth. However, one of the most significant factors hindering the growth of the flood insurance market is the high premium costs of flood insurance policies. Moreover, lack of awareness and misconceptions about flood risks and coverage limit the growth of the flood insurance market. On the contrary, increase in urbanization & infrastructure development in many regions and climate change & extreme weather events are expected to provide lucrative growth opportunities to the flood insurance market in the upcoming years.
The flood insurance market is segmented into coverage, application, and region. By coverage, the market is divided into building property coverage and personal contents coverage. Depending on application, it is fragmented into residential and commercial. Region-wise, the market is analyzed across North America, Europe, Asia-Pacific, and LAMEA.
The key players operating in the flood insurance market include GEICO, USAA, Neptune Flood, Allstate Insurance Company, Tokio Marine Highland Insurance Services, Inc., Berkshire Hathaway, Progressive Casualty Insurance Company, AXA, Chubb, and Assurant, Inc. These players have adopted various strategies to increase their market penetration and strengthen their position in the flood insurance industry.
One of the key drivers of the flood insurance market is an increase in the frequency and severity of floods. Furthermore, people have become more aware of the risks of flooding and the importance of flood insurance. This is due to better education and awareness campaigns by government agencies, insurance companies, and community organizations. Thus, the rise in awareness drives the demand for flood insurance, contributing to the flood insurance market growth. However, one of the most significant factors hindering the growth of the flood insurance market is the high premium costs of flood insurance policies. Moreover, lack of awareness and misconceptions about flood risks and coverage limit the growth of the flood insurance market. On the contrary, increase in urbanization & infrastructure development in many regions and climate change & extreme weather events are expected to provide lucrative growth opportunities to the flood insurance market in the upcoming years.
The flood insurance market is segmented into coverage, application, and region. By coverage, the market is divided into building property coverage and personal contents coverage. Depending on application, it is fragmented into residential and commercial. Region-wise, the market is analyzed across North America, Europe, Asia-Pacific, and LAMEA.
The key players operating in the flood insurance market include GEICO, USAA, Neptune Flood, Allstate Insurance Company, Tokio Marine Highland Insurance Services, Inc., Berkshire Hathaway, Progressive Casualty Insurance Company, AXA, Chubb, and Assurant, Inc. These players have adopted various strategies to increase their market penetration and strengthen their position in the flood insurance industry.
Key Benefits For Stakeholders
- The study provides in-depth analysis of the flood insurance market along with current trends and future estimations to illustrate the imminent investment pockets.
- Information about key drivers, restrains, & opportunities and their impact analysis on the Flood insurance market size are provided in the report.
- The Porter’s five forces analysis illustrates the potency of buyers and suppliers operating in the industry.
- The quantitative analysis of the flood insurance market from 2022 to 2032 is provided to determine the market potential.
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Key Market Segments
By Coverage
- Building Property Coverage
- Personal Contents Coverage
By Application
- Residential
- Commercial
By Region
- North America
- U.S.
- Canada
- Europe
- UK
- Germany
- France
- Italy
- Spain
- Rest of Europe
- Asia-Pacific
- China
- Japan
- India
- Australia
- South Korea
- Rest of Asia-Pacific
- LAMEA
- Latin America
- Middle East
- Africa
- Key Market Players
- Chubb
- GEICO
- USAA
- Allstate Insurance Company
- Progressive Casualty Insurance Company
- Assurant, Inc.
- Neptune Flood
- Berkshire Hathaway
- AXA
- Tokio Marine Highland Insurance Services, Inc.
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Table of Contents
CHAPTER 1: INTRODUCTION
CHAPTER 2: EXECUTIVE SUMMARY
CHAPTER 3: MARKET OVERVIEW
CHAPTER 4: FLOOD INSURANCE MARKET, BY COVERAGE
CHAPTER 5: FLOOD INSURANCE MARKET, BY APPLICATION
CHAPTER 6: FLOOD INSURANCE MARKET, BY REGION
CHAPTER 7: COMPETITIVE LANDSCAPE
CHAPTER 8: COMPANY PROFILES
List of Tables
List of Figures
Executive Summary
According to the report, the flood insurance market was valued at $12 billion in 2022, and is estimated to reach $50 billion by 2032, growing at a CAGR of 15.6% from 2023 to 2032.The flood insurance market is likely to experience a significant growth rate of 15.6% from 2022-2032, owing to increase in frequency and severity of floods, and increased awareness and education regarding flood insurance policy.
Flood insurance is a type of property insurance that provides coverage for losses caused by water damage specifically due to flooding. Floods are caused by heavy or prolonged rain, melting snow, coastal storm surges, blocked storm drainage systems, or levee dam failure. Flood insurance purchased through the National Flood Insurance Program (NFIP), in the U.S., provides up to $250,000 in building property damage and $100,000 in personal property damage.
Furthermore, in November 2022, with fewer than 5% of small businesses carrying flood insurance, FloodFlash launched a new coverage option that can pay catastrophic flood claims in just hours after a flood event. Approximately 80% of the world’s catastrophic flooding losses are uninsured. Parametric insurance could provide businesses with another means to protect their investment. Flood insurance is a vital risk management tool for any business operating in a high-risk area and FloodFlash gives companies a new option in this coverage market. Moreover, in November 2021, Neptune Flood, the first AI-driven flood insurance company to provide faster, easier, and better flood insurance, partnered with Indium, a national independent agency network. Indium agency partners have access to an instant flood solution that provides greater and broader coverage than the traditional National Flood Insurance Program (NFIP) under FEMA. Therefore, such strategies drive the growth of the market.
The market also offers growth opportunities to the key players in the market. Key players are adopting strategies to strengthen their market positions in the flood insurance industry, including new technology adoption, product developments, mergers and acquisitions, joint ventures, alliances, and partnerships. For instance, in October 2022, Flow Insurance launched its flood insurance marketplace with the help of INSTANDA’s complete digital platform. Flow and INSTANDA built a flood marketplace where agents can compare quotes from up to six insurers side-by-side, along with the NFIP rates. Agents can quote coverage as well as bind applications and service policies. In addition, in June 2023, the African Risk Capacity (ARC) Group launched a new insurance mechanism for African countries to cope with the devastating effects of flooding. This parametric insurance product provide countries with predictable and rapid financing for early response to cope with emergency disaster events caused by floods. The mechanism is a significant milestone in building resilience to climate-related disasters on the African continent and in complementing the ARC solutions.
The flood insurance market is segmented into coverage, application, and region. By coverage, the market is differentiated into building property coverage, and personal contents coverage. On the basis of application, the market is divided into residential and commercial. Region wise, it is analyzed across North America (the U.S., and Canada), Europe (UK, Germany, France, Italy, Spain, Netherlands, and rest of Europe), Asia-Pacific (China, Japan, India, Australia, South Korea, and rest of Asia-Pacific), and LAMEA (Latin America, Middle East, and Africa).
The key players profiled in the study are GEICO, USAA, Neptune Flood, Allstate Insurance Company, Tokio Marine Highland Insurance Services, Inc., Berkshire Hathaway, Progressive Casualty Insurance Company, AXA, Chubb, and Assurant, Inc. The players in the market have been actively engaged in the adoption of various strategies such as business expansion, product launch, collaboration, and partnership to remain competitive and gain an advantage over the competitors in the market. For instance, in July 2022, AI-driven flood insurtech Neptune Flood announced a new partnership with SIAA (Strategic Insurance Agency Alliance), a U.S. alliance of independent insurance agencies. With this partnership, SIAA members have access to Neptune solutions for flood risk through SIAA MarketFinder, SIAA’s online member-only portal for difficult-to-place and specialty risk markets. According to the insurer, Neptune offers coverage with limits eight times the level of the National Flood Insurance Program (NFIP). In addition, it provides multiple additional coverage options such as temporary living expenses, unattached structures, pool repair & refill, replacement cost on contents, and basement contents for homeowners, and business interruption coverage to help businesses recover from a flood event.
Key Market Insights
By coverage, the building property coverage segment was the highest revenue contributor to the market and is estimated to reach $28.91 billion by 2032, with a CAGR of 14.5%. However, the personal contents coverage segment is estimated to be the fastest-growing segment with a CAGR of 17.2% during the forecast period.By application, the commercial segment was the highest revenue contributor to the market, and is estimated to reach $31.24 billion by 2032, with a CAGR of 14.2%. However, the residential segment is estimated to be the fastest-growing segment with a CAGR of 18.2% during the forecast period.
Based on region, North America was the highest revenue contributor, accounting for $4.93 billion in 2022, and is estimated to reach $16.44 billion by 2032, with a CAGR of 13.0%. However, Asia-Pacific is estimated to be the fastest-growing region with a CAGR of 19.7% during the forecast period.
Companies Mentioned
- Chubb
- GEICO
- USAA
- Allstate Insurance Company
- Progressive Casualty Insurance Company
- Assurant, Inc.
- Neptune Flood
- Berkshire Hathaway
- AXA
- Tokio Marine Highland Insurance Services, Inc.
Methodology
The analyst offers exhaustive research and analysis based on a wide variety of factual inputs, which largely include interviews with industry participants, reliable statistics, and regional intelligence. The in-house industry experts play an instrumental role in designing analytic tools and models, tailored to the requirements of a particular industry segment. The primary research efforts include reaching out participants through mail, tele-conversations, referrals, professional networks, and face-to-face interactions.
They are also in professional corporate relations with various companies that allow them greater flexibility for reaching out to industry participants and commentators for interviews and discussions.
They also refer to a broad array of industry sources for their secondary research, which typically include; however, not limited to:
- Company SEC filings, annual reports, company websites, broker & financial reports, and investor presentations for competitive scenario and shape of the industry
- Scientific and technical writings for product information and related preemptions
- Regional government and statistical databases for macro analysis
- Authentic news articles and other related releases for market evaluation
- Internal and external proprietary databases, key market indicators, and relevant press releases for market estimates and forecast
Furthermore, the accuracy of the data will be analyzed and validated by conducting additional primaries with various industry experts and KOLs. They also provide robust post-sales support to clients.
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