Even as the full scale of devastation in the mountainous regions of North Carolina and Tennessee remains unknown, it’s clear that Hurricane Helene is one of the deadliest and most destructive storms in recent U.S. history. As of Friday, the storm had caused at least 180 deaths and destroyed or damaged many thousands of homes and other buildings.

In a preliminary damage estimate released on Thursday, the private forecaster AccuWeather pegged the financial cost of Hurricane Helene’s damages at $225 to $250 billion, more than double what it estimated in the first days after the storm made landfall in Florida last week — and far more than recent major hurricanes like 2012’s Sandy and 2017’s Harvey. That massive number includes the cost of rebuilding homes, businesses, roads, and infrastructure in the storm’s path from Florida to Tennessee, as well as the wages and economic output that will be lost during the yearslong rebuild.

Another fact that makes Helene’s devastation so unprecedented is that almost none of those hundreds of billions of dollars in losses will be paid out by insurance. While the storm caused most of its damage through flooding, which is covered under a government-run flood insurance program, very few residents of the southern Appalachian mountains hold flood policies — even those who live in federally designated flood zones. As of now, these storm victims in North Carolina and Tennessee have no guarantee of comprehensive public or private assistance as they try to piece their lives back together. The situation stands in stark contrast to other recent deadly storms like Hurricane Ian in 2022, where wind damage was paid out by standard homeowner’s insurance and flooding was limited to low-lying coastal areas where residents typically hold government flood insurance.

“A whole bunch of these [mountain] communities don’t have access to any of these things that can help you rebuild,” said Carolyn Kousky, an expert on disaster insurance who is the vice president for economics and policy at the nonprofit Environmental Defense Fund. “It’s going to be really heartbreaking. It’s going to be a very long time before they can rebuild.”

Helene will likely cause around $6.4 billion in insured damages, according to the catastrophe modeling firm Karen Clark & Company — a tiny figure for a direct hit from a Category 4 hurricane where winds reached 140 miles per hour. It’s barely half the total of insured damages from the 2018 wildfires in California, and only 10 percent as much as the damage from Hurricane Ian. 

Homeowner’s insurance premiums are rising almost everywhere in the United States as insurers deal with costly disasters, rising construction costs, and new development in vulnerable areas. They’re likely to continue to rise in states such as North Carolina, where the insurance commissioner just approved a double-digit premium rate hike.

But recent disasters such as Ian and the California wildfires have also seen many insurers go bankrupt or stop selling coverage in affected states. These market collapses have forced many homeowners to go without insurance or buy it from state-backed “insurers of last resort.” Despite Helene’s historic damage, states like North Carolina and Tennessee will likely not see a similar collapse in insurance availability.

“I’m not sure it’s going to have a big impact on the insurance market, because from an insurance industry perspective, this is not a very large loss,” said Karen Clark, the co-founder of Karen Clark & Company and one of the pioneers in the modeling of catastrophe risk.

That’s for the simple reason that most private companies stopped offering flood coverage around a century ago, following a series of devastating floods on the Mississippi River. The federal government then stepped in to try to protect America’s many waterfront homes from flood losses. As a result, insurance companies today pay out damage claims for wildfires in California and windstorms in the Midwest, but not for major rainfall events like Hurricane Helene.

The federal National Flood Insurance Program is supposed to serve as a public replacement for lost private coverage, but it isn’t working. The 5 million homes in the program tend to be very vulnerable to flooding, which has led to repeat loss events and driven the program billions of dollars into debt. The Federal Emergency Management Agency, or FEMA, has been trying for decades to enroll more people in the program, including those who live far from the coasts, but even its subsidized rates are out of reach for many homeowners. As a result, participation remains limited: in Asheville, the hardest-hit large city in North Carolina, fewer than 1 percent of residents have flood insurance.

Even given the huge coverage gaps, Helene will still likely trigger one of the largest FEMA flood insurance payouts in recent years, perhaps to the tune of billions of dollars. But Swiss Re, the massive global reinsurance company that acts as a backstop for the national program, confirmed that most people who suffered damage during Helene won’t get anything at all.

“Sadly much of the damage from these devastating floods will not be covered by insurance,” said Monica Ningen, who leads the company’s property business in the United States. She added that the lack of coverage “will make the task of rebuilding the communities impacted all the more difficult.”

Without insurance, which is often the first line of defense against disaster damage, most homeowners who saw flood damage will be on their own as they rebuild. Some victims will receive a few thousand dollars from FEMA for repair costs, and some others will be able to secure low-interest rebuilding loans from the Small Business Administration. The Department of Housing and Urban Development also has a track record of spending billions of dollars on long-term recovery needs after big disasters, paying for home repairs and new housing development.

But this aid money could take months or years to reach hard-hit areas, said Kousky, and it won’t come close to covering the cost of reconstruction for most people, especially those in low-income households.

“These programs were intentionally designed not to replace insurance,” said Kousky. “It’s really limited.” 

Despite the massive amount of media attention Hurricane Helene has generated, and the historic scale of the uninsured losses, Kousky said she’s pessimistic that the storm will change much about U.S. disaster policy, whether by encouraging more people to purchase flood insurance or increasing aid for disaster victims.

“There’s been so many events, they get attention and seem to be wake up calls, and our response has been insufficient every time,” she said.

Editor’s note: The Environmental Defense Fund is an advertiser with Grist. Advertisers have no role in Grist’s editorial decisions.