Learn about the expected loss per year a homeowner could face as a result of flood damage to their home.
Average annual flood damage loss is the total expected cost of flood damage to a home’s structure, averaged over a period of time. These estimates are based on the likelihood and depth of flood damage to a building, as well as building characteristics, structure value, and type of risk.
What are flood damage estimates?
Average annual flood damage estimates provide a powerful way to understand flood risk in terms of its potential dollar cost to property owners. These estimates refer to the average costs of all potential flood damage in a year, based on a residential property's flood projections.
It’s important to note that these estimates are different from a property’s Flood Factor, which tells you the likelihood of flood water reaching the building structure at least once over 30 years. How quickly the water reaches the footprint, how long it stays, and the home’s foundation type have a lot to do with the actual damage the home may experience.
How are flood damage estimates for a single year calculated?
The annual flood damage is the average cost of all potential flood damage in a given year, based on a property’s flood projections. To calculate these cost estimates, Flood Factor uses the following:
- An estimated cost for the property. In many cases on Flood Factor, this data comes from ComeHome by HouseCanary’s automated valuation model (AVM). HouseCanary is a leading source for property values and related data. Where AVMs are not available from ComeHome, they are estimated using the building characteristics through a peer-reviewed methodology developed by First Street Foundation.
- The estimated building structure value for that property. For example in some areas the land the home sits on may be 50% of the total property value, while in other places the land may be more valuable than the actual structure on the property.
- The estimated building characteristics for the property. For example if it has a basement, how many stories the structure is, and what the first flood elevation is.
- The type of flooding the building is at risk of. For example a surge from a hurricane causes a different type of damage then flooding from heavy rain.
- The projected depth and likelihood of flooding. These projections come from the First Street Foundation’s Flood Model.
These factors are then used in conjunction with historical data on flood damage costs from the United States Army Corps of Engineers (USACE). The USACE data analyzes the relationship between depth of flooding and the amount of damage caused, based on historical records from actual insurance claims. This then provides an estimate for expected loss per year that a property owner can expect to pay as a result of damage to their home from flooding.
If a property’s flood risk increases in the future, the average annual flood damage in 30 years will be higher than the estimate this year. Future annual flood damage estimates do not consider inflation or home improvements that might increase building value, both of which would increase flood damage costs.