Flooded and uninsured: Many Ruidoso residents face financial losses without coverage

Like many people in Ruidoso, Gary Garland does not have flood insurance. After floodwaters in the Rio Ruidoso rose to a record-breaking 20 feet this month, Garland’s two properties sustained “serious” damage, he said, totaling between $50,000 and $100,000. He plans to fix everything himself.

“We lost washers and dryers and refrigerators and ranges, all furniture, anything that was on the lower floor,” Garland said.

Garland is among 96% of homeowners nationwide who aren’t insured for floods, according to a Federal Emergency Management Agency estimate. Flood coverage is not typically included in standard property plans, and can be costly, confusing or simply overlooked, experts say.

As extreme weather becomes more frequent across the planet, many homeowners are left to shoulder devastating losses on their own when floodwaters rise.

In Ruidoso, floods swept trees, parked cars and entire houses downstream and killed three people — a 64-year-old man and two children, a brother and sister, ages 7 and 4. Garland said he has never seen such torrential flooding in his 45 years living in the Sierra Blanca mountain town. On Thursday, the federal government declared the floods in Lincoln County a major disaster.

“They’re all saying this one here was the big one,” Garland said, “but with global warming, I don’t know that this is not going to be a regular occurrence.”

In the span of just this month, rains and raging flash floods have torn across the East Coast, the Midwest and the Southwest, killing more than 140 people and destroying countless homes and businesses.

“We’re seeing an increase in the prevalence of flash flooding across the United States. Really, across the world,” said Jordan Suter, professor of agricultural and resource economics at Colorado State University.

When the atmosphere grows warmer — like from climate change — the air can hold more moisture, which is deposited as heavier rainfall, Suter said.

Burn scars from June 2024 wildfires in Ruidoso mean the soil can’t absorb water as it normally would, causing rainwater to surge into rivers and streams, creating a flash flood, Suter said. Combine wildfires with heavier-than-normal precipitation, “and it’s just a lethal mix.”

Garland said Mountain States Insurance dropped him from his property insurance plan, which didn’t include flood insurance, last year after the fires. Now, Garland has property coverage through the state of New Mexico’s last-resort Fair Access to Insurance Requirements plan — which he says he’s grateful for — but which also doesn’t include policies for flood insurance.

The private flood insurance market is small because most companies will not insure properties in a high-risk flood zone, said Philip Mulder, assistant professor of risk and insurance at the University of Wisconsin-Madison, leaving homeowners with a federal option — FEMA’s National Flood Insurance Program, which Garland says is expensive.

In Lincoln County, the median income is $10,625 less than the median income for the state.

“Very few people up here can afford flood insurance,” he said. “The prices are so high because insurance companies, they are there to make money.”

The NFIP will write almost anyone a policy, but it has a coverage limit of $250,000 for a building, which may not be enough to rebuild a home, Mulder said. Premiums in an area with low flood risk could be around $400 to $600 annually, but in a high flood risk area, an NFIP plan could cost anywhere from $1,000 to $4,000 per year, he said. Ruidoso’s ZIP codes are considered “relatively” high risk for riverine flooding per the NFIP risk tracker.

In Lincoln County, where Ruidoso is located, less than 2% of homes are insured through the NFIP, according to FEMA data. In Ruidoso alone, 387 homes were damaged by this month’s flooding as of last Thursday, around a third of them destroyed, said Ruidoso Mayor Lynn Crawford.

“A lot of people that we thought would have, should have had insurance, did not, because they said it was too expensive,” Crawford said. “As far as flood insurance, it’s just difficult to get.”

Most people in the rural county own their homes — about 8 out of every 10 households are owner-occupied, according to census data.

For New Mexico families who have owned the same house for years — sometimes centuries — no mortgage means there’s no requirement from the bank to buy property or flood insurance, said Benito Ortiz, who owns Strategic Insurance Group in Albuquerque, which sells both private and federal flood coverage.

“I can’t tell you how many times I’ve heard people tell me that they’ve owned their houses for 50 years and they’re not going to be part of a wildfire, and a few years later, their house is gone,” Ortiz said.

Despite many Ruidoso residents facing major property losses without insurance, they’re not confronting the crises completely by themselves. Garland said some men came up to Ruidoso from Alamogordo and cleaned out almost a foot of mud from his apartments with a vacuum truck, and another person with a tractor picked up all the dirt and sewage-covered furniture left outside.

“What I will tell you is that our community is strong,” Garland said. “We’re resilient people. We will recover.”