The impact of the National Flood Insurance Program on Galveston, Texas

Administered by the Federal Emergency Management Agency (FEMA) and established in 1968, the National Flood Insurance Program (NFIP) is one of the worlds longest standing public insurance programs (Michel-Kerjan, 2010). By 2012, NFIP had provided approximately $1.2 trillion of insurance coverage to nearly 6 million commercial and residential policyholders (FEMA, 2013). Because NFIP solely relies on premium collection from property owners, the unexpected number of claims caused by major hurricanes in 2005, 2008, and 2012 led to NFIP debt of nearly $30 billion, (CBO, 2013). Some residents remained socially and physically vulnerable as a result.