A Community-Based Flood Insurance Option by Committee on Community-Based Flood Insurance Options

Author:Committee on Community-Based Flood Insurance Options
Language: eng
Format: epub
Publisher: The National Academies Press
Published: 2015-10-15T00:00:00+00:00

A CONCEPTION OF COMMUNITY-BASED FLOOD INSURANCE

A basic premise underlying CBFI is that it may be less expensive and more effective to write single flood insurance policies at the community level than having insurance companies or the NFIP write multiple policies at the individual level. For this to be true, either the community must be more efficient than FEMA in writing policies covering individual entities, or the shift of responsibility from individual owners to the community will foster incentives to protect properties from floods.

The following section discusses the following topics: what is a community; the rationale for CBFI; spillovers across communities; how CBFI might provide solutions; and reasons why CBFI might not be successful.

What Is a Community?

There is no single definition of what constitutes a “community,” and many different definitions exist in an array of contexts. For example, definitions of “community” in Webster’s Ninth New Collegiate Dictionary include

“a unified group of individuals”; “people with common interests living in a particular area”; “a group linked by a common policy”; and “a body of persons having a common history or common social, economic, and political interests.”

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