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Introduction
Globally, floods are prevalent natural disasters including monsoons and flash floods, which pose a significant threat to homes, vehicles, livelihoods, and lives. Consequently, adapting to natural disasters, particularly floods, is a crucial challenge for people in building and maintaining sustainable societies (Richerta et al. 2016). Therefore, the important question arises: What compels citizens and businesses in emerging economies to battle with the invincible force of nature, particularly flood catastrophes? The answer lies in the fact that insurance can provide a sense of security during and after a disaster, serving as the backbone for people to safeguard their futures (Raza et al. 2020). According to Alam et al. (2020), insurance is crucial in managing risk at every level, aiding moderate-income individuals in coping with the financial consequences of climate-related perils, supporting adaptation actions, stabilizing regional revenues, and minimizing reliance on public resources for disaster recovery. Moreover, insurance facilitates private-public partnerships and helps individuals and communities recover from disasters swiftly, addressing a wide range of risks through specialized insurance products. In particular, flood insurance provides financial assistance to repair or replace damaged property, offers peace of mind, aids in the recovery and rebuilding processes, and contributes to community resilience. Studies have shown that those with insurance recover faster than those without insurance (Bradt et al. 2021). Insurance is the most effective way to address these obstacles (Tesselaar et al. 2022). Therefore, it is crucial for residents of flood-prone areas to understand the value of flood insurance and consider acquiring it to protect their homes and other valuables. Procuring an insurance policy can reduce the risk individuals face amidst unexpected costs, shielding them from the negative effects of financial burdens (Mamun et al. 2021).
Peninsular Malaysia has faced the devastating consequences of major floods since 1886, constituting a recurrent disaster that has resulted in significant socio-economic and humanitarian issues in the area, as reported by Lim et al. (2019). The impact of floods can be divided into two categories: short- and long-term. The short-term consequences of floods include loss of life, injury, destruction of infrastructure, and damage to businesses, crops, fisheries, animals, property, and infections. Conversely, the long-term consequences involve rebuilding homes, infrastructure, and roads, loss of commerce and industry, and of the financial burdens associated with...