The NAIC merged three catastrophe bodies into a single Natural Catastrophe Risk and Resilience Task Force at its Spring 2026 National Meeting, reporting directly to the Executive Committee. Its Flood Insurance Blueprint aims to expand private flood options against a private market that wrote $730 million in 2024.

That is roughly 13% to 15% of the flood premium base, and it shrank 9.1% year over year. The Blueprint's problem is not awareness. It is that the segment private carriers can profitably reach is defined by someone else's rate cap.

Key Takeaways

  • Private flood wrote $730 million of net premium in 2024, down 9.1%, at a combined ratio of 83.1 against 33.9 the year before, a 49.2-point swing in a single catastrophe season.
  • The NFIP holds roughly 4.7 million policies and $1.3 trillion of coverage in force, alongside approximately $20.5 billion of debt to the Treasury as of December 2020, after Congress cancelled $16 billion in October 2017.
  • A statutory 18% annual cap on NFIP premium increases means high-risk properties converge to risk-adequate pricing over a decade or more, and no private carrier can quote against a rate still in transit.
  • The top 10 private flood writers hold about 79% of direct premium, led by AXA at 13.0%, and all are diversified multiline carriers allocating marginal capacity rather than flood specialists.
  • Inland flood models carry confidence intervals of plus or minus 50% to 100% at property level beyond 50-year return periods, against 15% to 25% for coastal surge.

What the Restructuring Actually Created

The Task Force absorbs the Climate and Resiliency Task Force, the Catastrophe Insurance Working Group and the FEMA Working Group into one body sitting under the Executive Committee. Flood-related regulatory work previously ran across at least three charge sheets with different reporting lines.

Two working groups report to it. The Severe Peril Working Group covers protection gaps across hurricane, wildfire, atmospheric river, severe convective storm, hail, landslide and flood, and its Charge #4, a national awareness campaign incorporating available flood insurance options, is the operational mandate behind the Blueprint. The Pre-Disaster Mitigation and Risk Modeling Working Group handles catastrophe model assessment and regulator training with the CAT COE.

The scale the Blueprint is working against is set by the federal program. The NFIP holds roughly 4.7 million policies and about $1.3 trillion of coverage in force, with approximately $20.5 billion of Treasury debt as of December 2020 after Congress cancelled $16 billion in October 2017.

Participation is the stated problem. Only about 30% to 35% of properties in FEMA Special Flood Hazard Areas carry flood insurance, and outside those areas, where roughly 25% to 30% of flood claims originate, take-up falls to single digits.

The Cap Defines the Addressable Market

The barrier is not consumer awareness, and it is quantified in the NFIP's own rating reform.

Risk Rating 2.0 launched in October 2021 and April 2022, replacing zone-based maps with property-level pricing built on catastrophe models, replacement cost, flood type and distance to water. At launch FEMA projected 23% of policyholders seeing an immediate decrease, 66% seeing increases of $0 to $10 a month, and 11% facing increases above $10.

The statutory 18% annual increase cap is what governs the market structure. For a property whose Risk Rating 2.0 rate sits well above its legacy rate, convergence takes a decade or more, and the property receives an implicit subsidy throughout. Before the reform, roughly 20% to 25% of NFIP policies were explicitly subsidized, some paying 40% to 60% of full actuarial rates. The cap converted an explicit subsidy into a glide path without changing what a competitor faces.

That splits the market cleanly. Where the NFIP rate has reached or passed actuarial cost, a private carrier can quote and win. Where the rate is still climbing under the cap, any private quote has to carry the full risk-adequate premium against a subsidized incumbent, so those policies stay federal regardless of appetite.

The consequence runs the other way too. Each low-risk policy a private carrier writes concentrates the federal book further into high-risk properties the NFIP cannot decline, raising its average loss cost while its premium base falls, which strengthens the case for keeping the cap that produced the selection.

What is left for the private market is a thin and volatile slice.

Year Net Written Premium Year-over-Year Change Combined Ratio
2024$730.0M-9.1%83.1
2023$803.1M+3.7%33.9
2022$774.3M+47.7%N/A
2021$524.2M+73.3%N/A
 Source: Insurance Information Institute, citing S&P Global Market Intelligence

Premium nearly tripled from $302 million in 2020 to $803.1 million in 2023 at a combined ratio of 33.9, then fell 9.1% to $730.0 million in 2024 at 83.1. The growth broke in the first season that tested the book. Concentration compounds it: the top 10 writers hold about 79% of direct premium, led by AXA at 13.0% ($159.8 million), Assurant at 11.5%, MS&AD and Berkshire Hathaway at 10.7% each and Liberty Mutual at 7.5%. These are diversified carriers treating flood as one line, not dedicated flood companies, which means capacity can be withdrawn on a portfolio decision rather than a flood decision.

The Growth Is Wanted Where the Models Are Weakest

The Blueprint's protection-gap target is inland, and inland is where the pricing evidence thins out.

Coastal storm surge modelling rests on well-understood wind field physics, decades of storm track observation and high-resolution bathymetry. Confidence intervals on 100-year return period surge heights run plus or minus 15% to 25%, tight enough to support property-level rates that carriers and regulators both accept.

Pluvial flooding depends on drainage capacity, soil permeability, impervious surface coverage, elevation gradients measured in inches, and precipitation patterns that vary over a few hundred feet. Riverine flooding adds gauge data and compound events where rainfall, snowmelt and antecedent saturation interact. The result is confidence intervals of plus or minus 50% to 100% at property level beyond 50-year return periods. The two main commercial models, Verisk's US Inland Flood Model and Moody's US Flood Model, arrived commercially between 2015 and 2018, under a decade of development against multiple decades for hurricane models.

Three things follow, and each works against the Blueprint's objective. A defensible rate range that wide makes it harder to file something simultaneously competitive with the NFIP and adequate for solvency. Rate review turns more subjective where model output spans that range, which slows approvals in prior-approval states. And reinsurers pricing excess flood treaties carry the same uncertainty, pushing ceded cost up and thinning the primary carrier's net margin.

So the segment where the Blueprint most needs private capacity, the inland properties outside Special Flood Hazard Areas generating 25% to 30% of claims at single-digit take-up, is the segment whose loss cost is hardest to defend in a filing. The Pre-Disaster Mitigation Working Group's model assessment and regulator training charge is not adjacent to the Blueprint. It is upstream of it.

Further Reading

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