FEMA Budget Cuts Shift Disaster Risk and Cost to Homeowners
HC
Hazel Callahan
homeowners insurance dropped · Apr 15, 2026
Source: DojiDoji Data Terminal
Homeowners in high-risk areas face higher insurance premiums as federal funding for disaster mitigation is reduced. This increase is driven by the loss of federal grants that protect property.
Funding for FEMA's Building Resilient Infrastructure and Communities (BRIC) program and the National Flood Insurance Program (NFIP) has been cut. These programs provide grants that can fund up to 75% of project costs to build infrastructure that protects homes and businesses by mitigating weather-related damage.
Federal policies now eliminate future grant opportunities and cut off current funding, leaving many communities in the middle of infrastructure upgrades or replacements with no way to finish. Infrastructure that protects homes and businesses from natural disasters is not built or upgraded, which increases the risk of greater property damage.
As the risk of property damage increases, insurers expect more costly claims. To cover these costs, insurance companies request rate increases from state regulators.
Homeowners in high-risk areas face higher premiums. For those who rely on the National Flood Insurance Program for affordable coverage, a push to move flood insurance to local and private programs may leave them unable to afford the necessary insurance in high-risk areas.