The catastrophic floods that ravaged central Texas at the beginning of July underscore the need for enhanced risk management, effective planning, resilient infrastructure, and advanced early warning systems, according to Moody’s.

The rapid rise in Guadalupe River water levels (over 30 feet in under two hours) and the explosive increase in river flow from approximately 10 cubic feet per second to more than 120,000 cfs produced overwhelming hydraulic forces comparable to those observed in dam break scenarios. The flood event shattered the area’s previous, century-old record of 36.60 feet set in July 1932.

Today, more than 23 million people in the US live behind levees, relying on these systems for protection against flood risk. These levees safeguard more than US$2trn in property, including homes, businesses and critical infrastructure. However, the average levee is over 60 years old, meaning many were built before modern engineering standards and designed for a different era.

When it comes to insurance, most central Texas counties devastated by the flash flooding show extremely low NFIP participation levels. According to Guy Carpenter, despite the well-documented flood vulnerability of the Hill Country, these inland regions lack the insurance coverage seen in coastal counties like Harris and Galveston. With only 467 National Flood Insurance Programme policies as of May 2025, Kerr County’s flood insurance take-up rate stands at less than 2%.

“Floods becoming more frequent and intense underscores the limitations of relying solely on historical flood levels to assess current and future risk,” said Firas Saleh, director of north American flood models at Moody’s. “Risk mitigation remains our frontline defence to help reduce future devastating impacts on communities and economies.”

Elevating first floors above base flood elevation, using flood-resistant materials, and reinforcing structures to withstand high water velocities can significantly reduce vulnerability during flood events. These localised strategies are especially critical in high-risk areas where infrastructure systems are often ageing, and structural defences may be overtopped or breached.

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