Pros and Cons of a Public Disaster Risk Reinsurance Program for U.S. Residential Properties

Lloyd Dixon, Noreen Clancy, Daniel Marns

Expert InsightsPublished Sep 4, 2025

The U.S. residential insurance market does not appear to be holding up well in the face of rising natural disaster risk. These problems are multifaceted and caused by many factors, but there are several potential strategies to address them. This paper explores one of these strategies: a public reinsurance program for residential properties. The authors begin by providing background on the U.S. residential insurance market and then review examples of public insurance and reinsurance programs in the United States and other countries. They describe the pros and cons of this approach and conclude by identifying factors that should be considered in deciding whether to proceed with a public reinsurance program for residential properties in the United States.

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Dixon, Lloyd, Noreen Clancy, and Daniel Marns, Pros and Cons of a Public Disaster Risk Reinsurance Program for U.S. Residential Properties. Santa Monica, CA: RAND Corporation, 2025. https://www.rand.org/pubs/perspectives/PEA3794-1.html.
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This work was sponsored by the RAND Disaster Management and Resilience Program and by the generous contributions of the RAND Kenneth R. Feinberg Center for Catastrophic Risk Management and Compensation Advisory Board. The work was conducted in the Disaster Management and Resilience Program of the RAND Homeland Security Research Division and the Kenneth R. Feinberg Center for Catastrophic Risk Management and Compensation within RAND Social and Economic Well-Being.

This publication is part of the RAND expert insights series. The expert insights series presents perspectives on timely policy issues.

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