RMI faculty offers analysis, solutions to state regulators on growing disaster risks

Charles Nyce, FSU’s Dr. William T. Hold Professor of Risk Management and Insurance and chair of the Department of Risk Management/Insurance, Real Estate and Legal Studies, says the report provides an example of his department's work to help policymakers "develop solutions to real-world problems."
Photo by Kallen M. Lunt/College of Business Click to enlarge

On the strength of a $500,000 grant, the Dr. William T. Hold/The Alliance’s Program in Risk Management and Insurance in the Florida State University College of Business delivered to state regulators an analysis of the National Flood Insurance Program and solutions to managing Florida’s growing risks from hurricanes and other natural disasters.

The Florida Legislature awarded the grant in fall 2024 through the state Office of Insurance Regulation, which sought the report from FSU’s RMI program amid concerns from storm-impacted Florida homeowners. The RMI program delivered the report in December.

“This report presents a deep dive into the tradeoffs that exist in trying to manage multiple natural hazard risks, including floods and wind, that involve vastly different mitigation techniques,” said Charles Nyce, FSU’s Dr. William T. Hold Professor of Risk Management and Insurance and chair of the Department of Risk Management/Insurance, Real Estate and Legal Studies. “Also, in helping policymakers develop solutions to real-world problems, we further demonstrate our faculty's value to not only our students, but also all of Florida's residents.”

Elaborating on tradeoffs, Nyce said many Florida homeowners often must choose between protecting their home against either wind or water damage because they lack the budget to protect against both. The RMI report explains these kind of challenges in detail, showcasing the department's knowledge and expertise.

Known as one of the nation's oldest and largest insurance programs, FSU RMI is perennially ranked among the nation’s top such programs in the largest catastrophic risk market in the U.S. and the seventh-largest insurance market in the world.

The report provides an objective view of the mechanisms of the National Flood Insurance Program, or NFIP, and their effects on homeowners, real estate markets and tax revenues. The NFIP, administered by the Federal Emergency Management Agency, or FEMA, aims to provide affordable insurance to property owners and businesses. It also encourages communities to adopt and enforce floodplain management regulations.

The study also gives legislators comprehensively informed perspectives to consider when proposing solutions for Florida.

“As our exposure to disasters continues to grow,” Nyce said, “solutions to these types of challenges are vital to manage potential losses for future generations."