Shirleen Laubenthal is a senior vice president, environmental in the Atlanta office of EPIC Insurance Brokers and Consultants. Opinions are the author’s own.
AEC firms are facing the 2026 hurricane season with less federal support for disaster preparedness and response than they’ve ever had.
The Federal Emergency Management Agency and National Oceanic and Atmospheric Administration have seen sweeping cuts to climate forecasting, hazard mitigation grants and flood-risk standards since January 2025.
These disruptions are complicating project delivery and operational planning for many firms, requiring them to navigate gaps in climate risk assessment, funding and code guidance that the federal government has long provided.
As risk modeling grows less reliable and disaster resources harder to access, firms need to take a more deliberate look at where they build and how they design to shield themselves from liability.
Key funding changes
The federal rollbacks span both FEMA and NOAA and touch nearly every layer of disaster preparedness infrastructure.
In spring 2025, FEMA revoked mandatory compliance with Federal Flood Risk Management Standards. It also terminated the Building Resilient Infrastructure and Communities program — a major source of pre-disaster mitigation funding that was later restored by court order after a year of uncertainty.
Other hazard mitigation programs, including the Hazard Mitigation Grant Program and Flood Mitigation Assistance, saw funding reduced or frozen. At NOAA, reductions in climate data collection and the retirement of the Billion Dollar Weather and Climate Disasters database have slowed the flow of risk data the industry has long depended on.
Adding to the uncertainty, the National Flood Insurance Program lapsed for more than a month during the government shutdown in fall 2025 and is currently authorized only through September 2026.
These shifts are already affecting how insurers assess risk, and the project and design decisions firms make every day in several ways:
Less reliable flood maps. FEMA flood maps depend on NOAA climate and weather data to stay current. With that data collection scaled back, maps are becoming less reliable. As a result, firms are increasingly turning to local weather records, historical storm patterns and private risk models to fill the gap.
Rising liability exposure. Revocation of the FFRMS eliminated the federal baseline that had defined minimum design requirements for projects built in flood-prone areas. With those standards gone, more design and liability decisions fall to firms and the engineer of record. reach-of-duty claims are expected to rise when structures suffer flood or storm damage that better design could have prevented.
A fragmented funding landscape. State and local governments have long relied on federal grants to fund resilience planning and disaster recovery. But that pipeline has become unreliable amid repeated cycles of cancellation, legal challenge and delay. Engineering and architecture firms working with municipal or public agency clients are already navigating delayed projects, reduced scope and a more complex path to keeping clients compliant and protected.
Gaps in code guidance. FEMA has historically played an active role in developing and updating the international codes that govern construction standards. As that participation diminishes, the industry is leaning harder on private organizations such as the American Society of Civil Engineers for guidance on infrastructure. That leaves firms navigating a patchwork of standards on their own and facing greater liability exposure if a design later proves inadequate.
6 ways to build resilience into operations
A strong business continuity plan is the best defense against rising insurance costs, greater liability exposure and slower disaster recovery. Here are six steps to build a robust plan:
1. Routinely assess flood risk. Don't rely solely on FEMA flood maps to determine whether project sites are in flood zones. Layer local data, historical weather patterns and private models into your flood risk evaluation. If a site is in or near a flood zone, confirm NFIP participation and explore “Write Your Own” private insurance options.
2. Prioritize resilient design. Consider minimum code requirements a starting point. Elevate mechanicals above base flood elevation, use flood-resistant materials, waterproof below-grade structures and improve site drainage. Design to the actual risk profile of the location, not just what code requires.
3. Build a site-specific emergency plan. Every jobsite and company location should have a tailored emergency response plan that goes beyond evacuation. Account for how equipment, hazardous materials and lab facilities would be secured or removed in a storm event. With federal disaster response slower and less resourced, preparation needs to happen well before a storm is forecasted.
4. Revisit contracts. As more disaster costs shift to state and local governments, firms may face new liabilities from clients and project owners. Review contract terms around project delays, equipment loss and disaster response to ensure responsibility is clearly defined. Acts of God clauses won't cover every scenario. Separately, firms could face breach-of-duty claims if a project is found to have been under-designed for the known risk at that site.
5. Monitor policy changes. Changes to disaster aid eligibility, permitting requirements and community flood insurance availability can affect project feasibility, client budgets and timelines. Firms that monitor these shifts closely can advise clients earlier and avoid costly surprises mid-project.
6. Explore alternative risk financing. With the NFIP under financial strain and private carriers pulling back from high-risk markets, standard coverage may not be sufficient. Parametric insurance, which pays out based on predefined triggers like wind speed or rainfall totals, can offer faster and more predictable recovery. Captive insurance and other alternative risk financing structures may also be worth exploring for firms with significant exposure or multiple locations.
Preparation is paramount
The federal support firms have long relied on to assess disaster risk, design to standard and fund resilience is thinner and less predictable than it has been in decades. With hurricane season underway and federal support no longer a given, the firms that come out ahead will be the ones verifying their own risk data, designing above code and tightening up contracts.
Waiting for the old certainty to return is not a strategy.
