Houston could see a significant reduction in federal flood insurance premiums starting next spring following the Houston City Council’s approval of an extensive watershed master plan. This plan is anticipated to elevate Houston’s rating within FEMA’s National Flood Insurance Program (NFIP) from a class 5 to either a class 4 or 3, potentially offering residents discounts of 5% or 10% on their insurance premiums.
Currently classified as a class 5 city in the NFIP’s Community Rating System (CRS), Houston residents benefit from a 25% discount on federal flood insurance. The CRS awards ratings from 10 (lowest) to 1 (highest) based on compliance and implementation of recommended flood mitigation activities. An improvement in the city’s rating correlates with an increased discount on flood insurance premiums, with each class upgrade bringing a 5% reduction.
Richard Smith, interim director of Houston Public Works, assured the City Council that these enhanced discounts would become effective by April 1, 2025.
The watershed master plan, outlined in a briefing from Houston Public Works, involves a comprehensive review of the city’s watersheds. This includes assessing current development, major drainage infrastructure, runoff conditions, and future development impacts. FEMA will incorporate the watershed master plan findings into its annual audit, expected to conclude by mid-August.
Houston has faced severe flooding events in recent years. This year alone, the city encountered two major floods: a May deluge that caused school closures, evacuations, and damage to 800 properties, and Hurricane Beryl, which inundated parts of the city with 6 to 12 inches of rain earlier this month.
The devastating impact of Hurricane Harvey in 2017, which resulted in widespread flooding, significant property damage, and an estimated $125 billion in losses, highlighted the need for improved flood management. A subsequent report identified inadequate regulatory measures and insufficient flood risk awareness as factors contributing to the flood damage.
In response, Houston and Harris County have invested nearly a billion dollars in flood mitigation efforts. Alan Black, an engineer with the Harris County Flood Control District, reported in 2022 that these efforts have made Houston the top recipient of CRS discounts in Texas. In 2023, Houston residents with NFIP policies received $13.9 million in premium discounts due to the city’s class 5 rating.
