Do residents of Appalachia need flood insurance?

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Because of the terrain, the region has suffered recent devastating floods

By Mark Huffman of ConsumerAffairs

April 10, 2025

Key takeaways

• Recent catastrophic floods in Kentucky, Tennessee, and West Virginiadriven by heavy rainfall, mountainous terrain, and aging infrastructurehave revealed that many areas in Appalachia are at serious risk of flooding, even when theyre far from rivers or coastlines. Official FEMA maps vastly underestimate this risk.

• Despite the increasing flood danger, fewer than 1% of homes in the region have flood insurance. A significant number of properties damaged in past floods were uninsured.

• FEMA flood maps may not capture true risk, so homeownerseven outside designated flood zonesshould evaluate their propertys vulnerability based on topography and local conditions.

People living in low-lying coastal areas often purchase flood insurance and are sometimes required to do so by their lender. But homeowners in the central U.S. probably dont think about it much.

However, after the devastating floods in Kentucky, Tennessee and West Virginia, it may be a growing topic of conversation.

Neptune Flood, which sells flood insurance, has released its analysis of the increasing flood risk across Kentucky, Tennessee, and West Virginia after catastrophic flooding that was fueled by increased rainfall, mountainous terrain, and aging infrastructure.

The report is sounding the alarm over what it sees as an escalating crisis: rising flood risk is outpacing insurance coverage across Appalachia, leaving communities increasingly vulnerable. Even though the nearest river may be miles away, intense rainfall over mountainous terrain can lead to devastating flash floods.

Death and destruction

The 2025 floods alone claimed 21 lives and prompted over 1,100 claims under the National Flood Insurance Program (NFIP). These events follow a string of deadly and costly disasters involving flooding, including:

• The 2022 Eastern Kentucky flood, which resulted in 44 deaths and damaged nearly 9,000 properties

• The 2016 West Virginia flood, with 23 fatalities and over $1.1 billion in property damage

• The 2010 Nashville flood, which left 21 dead and caused more than $2 billion in damage

Neptune said there is a stark disparity between official flood zone designations and the true extent of risk. While FEMA flood maps identify approximately 365,000 buildings in high-risk areas across the three states, research from the First Street Foundation estimates the actual number of properties facing substantial flood risk is closer to 950,000more than 2.5 times higher.

According to Neptunes analysis, fewer than 1% of homes in Kentucky, Tennessee, and West Virginia are currently covered by flood insurance. During the 2022 Kentucky floods, 95% of damaged homes were uninsured, according to the report.

Declining coveage

From 2021 to 2024, NFIP policies in the region dropped by 17%, a trend Neptune attributes to premium hikes under FEMAs Risk Rating 2.0 system. In some Appalachian counties, premium increases of 200% or more are forcing homeowners to abandon coverage. In extreme cases, flood insurance costs now consume between 6% and 9% of annual household incomewell above recommended affordability thresholds.

Homeowners who think they need flood insurance should not rely solely on FEMA maps: Many high-risk areas are not officially mapped, so even if you’re not in a FEMA-designated flood zone, you may still be at risk.

Your local topography is a factor. Homes near rivers, valleys, or areas with poor drainage can be vulnerable.

The federally-backed National Flood Insurance Program is available to communities that participate in FEMAs floodplain management. Coverage limits are $250,000 for structure and $100,000 for contents. There is typically has a 30-day waiting period.

Private flood insurance often provides higher coverage limits, shorter waiting periods, and sometimes lower premiumsespecially for homes with moderate risk.

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