High-risk areas

Insurance defines high-risk areas as geographic zones with statistically higher probabilities of loss, such as frequent wildfires in California or flood-prone zip codes along the Gulf Coast. Insurers classify ZIP codes with repeated hurricane claims–like Miami-Dade County, Florida–as high-risk due to NOAA tracking over 40 named storms affecting the area since 2000.

Companies use FEMA’s Flood Insurance Rate Maps to determine flood risk and set premiums accordingly for properties located within Special Flood Hazard Areas (SFHAs). Premiums for homeowners insurance can double in wildfire-prone counties like Sonoma, California after more than $12 billion in losses from the 2017–2018 fire seasons.

High crime rates, tracked by FBI Uniform Crime Reporting, mark urban neighborhoods such as parts of Detroit, Michigan as high-risk for theft or vandalism coverage. Earthquake risks drive premium increases in San Francisco and Los Angeles, both ranking highest on USGS seismic hazard maps.

State regulators require insurers to disclose “high-risk” classifications in official rate filings, available through state Departments of Insurance websites. Mortgage lenders frequently mandate additional coverage–such as flood insurance–for homes identified within these mapped high-risk areas by FEMA.

Insurers may exclude windstorm damage in policies covering coastal Texas counties due to historical data showing annual average insured wind losses exceeding $500 million statewide (Texas Department of Insurance). Population density metrics from the U.S.

Census Bureau help identify city blocks at increased fire and liability risk, impacting local policy rates, as delivered by Your Insurance Info. High-risk area designations update regularly using catastrophe modeling data sets like CoreLogic’s Hazard Risk Score, which considers claims frequency and severity trends.