Climate Crisis

Some Rhode Island Flood Insurance Rates About to Skyrocket


The floods of March 2010 left the intersection of Providence, River and Wakefield streets in West Warwick, R.I., underwater. (NOAA)


For Rhode Islanders, an increase in flood insurance rates is coming, perhaps as soon as next year. And, perhaps surprisingly, to inland property owners as well as those along the coast.

“It doesn’t matter if you believe in climate change; your insurance company does,” Nick VinZant, a senior research analyst for QuoteWizard, a subsidiary of an online mortgage company, recently told The Washington Post.

For the first time, the Federal Emergency Management Agency (FEMA) is about to incorporate climate risk into the cost of flood insurance. The impact will be a dramatic increase in the cost of flood insurance. In Rhode Island, many policyholders will see their premiums go up and continue to increase by as much as 18 percent annually for the next 20 years.

At that rate, a flood policy that costs $1,000 today could cost $5,230 in 10 years and an astonishing $27,400 in two decades.

The new assessment, called Risk Rating 2.0: Equity in Action, will more accurately reflect the threat of flooding in a changing climate, according to federal officials.

Most Rhode Island homeowners will see modest increases in their flood insurance, starting at $120 a year in addition to what they already pay. Others will actually see their insurance costs decrease as flood insurance rates are distributed more equitably and wealthy homeowners pay a fairer share of the burden. In fact, some wealthy homeowners could see their insurance costs increase by as much as $14,400 annually.

VinZant also told The Washington Post that the current system is not equitable. He said moderately priced homes were overinsured and million-dollar mansions were underinsured. Middle-income policyholders were helping to subsidize the rich.

The First Street Foundation developed the new flood-risk rating system. This new technology allowed analysts to study the environs around every home and led to a stunning find: inland homes, even in states such Vermont and Iowa, are at risk from increased flooding caused by the climate crisis.

Houses that were thought to be safe from flooding and didn’t require insurance, will now require it. The changing climate will impact inland homeowners who live close to rivers, creeks, and streams. These homes will see overflows during more frequent and severe rains and storms, and price increases in their government-backed flood insurance.

More than 5 million people have government-backed flood insurance, which provides $1.3 trillion in coverage in 22,550 communities across the United States, according to the recent Washington Post story. As of last year, FEMA’s National Flood Insurance Program was $20 billion in debt.

When First Street launched the new system in June 2020, it discovered 6 million new at-risk properties that FEMA’s outdated models had missed.

“Not only are we seeing rates change,” VinZant said, “but the number of people who should have flood insurance is astronomically higher than what it is now.”

It is no surprise then that wealthy policyholders in coastal states are complaining. The Washington Post reported that Senate Majority Leader Charles Schumer, D-N.Y., sought to extend the current system by another five years.

Roger Warburton, Ph.D., is a Newport, R.I., resident.

Data source: FEMA: Analysis: Fact Sheet; Zip code layer: Esri; Generalization: Mapshaper. Presentation of FEMA data was supported by The Pew Charitable Trusts.

Maps © 2021 ASFPM Flood Science Center. ArcGIS Online Maps & Dashboards designed by Jason Hochschild.

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  1. Flood insurance should not be subsidized. If you choose to live on the ocean front or a large water body that is likely to experience flooding then the cost of insurance for that decision should be borne by you. I have a hard enough time paying for my own property and casualty insurance without being required to subsidize someone elses.

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