PROVIDENCE — Florida has been rocked by destructive hurricanes, and California by catastrophic wildfires, leading many insurance companies to either raise their rates or withdraw from those states.

Is something similar happening in Rhode Island?

According to Elizabeth Dwyer, director of the Department of Business Regulation, which oversees many commercial insurance policies in Rhode Island, homeowner insurance rates are increasing, but not because of what is happening in other states.

“Building costs go up, demand goes up — they call it the demand surge — it’s more expensive to repair your home, and reinsurance costs go up,” Dwyer testified recently before the House of Representatives study commission on climate change impacts. “Are my rates going up because of wildfires in California? The answer is no, because there’s no direct effect like that.”

Insurance availability in Rhode Island isn’t the issue, according to Dwyer, but rather insurance affordability. Property insurance premiums are expected to rise in the near future, she said, and most Rhode Island homeowners lack flood insurance, since it isn’t required.

The House study commission, created last year by legislation introduced by Rep. Terri Cortvriend, D-Portsmouth, is examining the current impacts of climate change on the Ocean State. The commission to date has heard how the state plans for climate change disasters such as floods and hurricanes, and how scientists at the University of Rhode Island project how once-in-a-century storm events and coastal flooding will impact municipalities.

The most recent testimony, from Dwyer and Ernie Shaghalian, a veteran insurance agent from the Butler & Messier Insurance Agency, will likely strike most Rhode Islanders as boring, but also literally, closer to home.

“Insurance tends to be something you sign up for and then forget,” Dwyer told the commission. “But how do we get out to consumers if they don’t have flood coverage in their home insurance policies … flood risk is increasing … and your home is the biggest asset for most of us?”

Dwyer said the state’s home insurance market is currently stable. But, thanks to costs elsewhere in the country, premiums are going up, and affordability, in the light of climate change impacts, is becoming an issue.

“Coastal community problems for homeowners, most of them are affected by the increased wind risk,” Shaghalian said. “Most homes near the coast are going to get more damage from a wind storm that comes up the coast than houses in Johnston or Woonsocket.”

Shahaglian noted most new insurance policies on homes within 3 miles of the state’s coastlines are either more expensive than elsewhere in Rhode Island, or nonexistent.

“There’s a drastic availability difference problem if you live near the coast than [for] people who live in Providence,” he said.

The Rhode Island Fair Access to Insurance Requirements (FAIR) plan, administered through the Rhode Island Joint Reinsurance Association, has added 2,000 additional policies to its risk pool in the past two years, an indication that homeowners aren’t getting the coverage they need through the private insurance market, according to Shahaglian.

It’s hardly news in the insurance industry. In 2021, the National Flood Insurance Program (NFIP) switched from flood-map-based risk analysis to a new pricing methodology that took into account more flood risk variables to result in more equitable insurance rates in the face of climate change.

NFIP was originally established in 1968 to fill in the gap left by private insurers that declined to cover flooding. It’s funded by the federal government, and as of 2021 was around $20 billion in debt, even after $16 billion in debt was canceled in 2017 to meet claims after hurricanes Harvey, Irma, and Maria.

Prior to the switch in 2021, most premiums were based on property elevation according to zones on a flood insurance rate map, which gave static measurements and left room for inequities in pricing and coverage.

Flooding as a whole is the most frequent and expensive natural disaster in the United States, according to the Federal Emergency Management Agency. As climate change worsens in the Northeast, flooding is expected to increase, especially in coastal regions susceptible to sea level rise, like Rhode Island.

Insuring homes has been a growing and acute crisis in states such as California and Florida. Insurance carriers have pulled out of both states in recent years, citing the increased cost of insurance due to climate change disasters such as wildfires and hurricanes.

The disasters are not only becoming more frequent, but more fierce, resulting in higher damage estimates and higher costs to rebuild. Insurance companies posted nearly $80 billion in losses in 2023 from natural disasters, all related to climate risk. Wildfires in California at the beginning of this year have damaged or destroyed more than 18,000 structures.

Unusual flooding, even outside a flood zone, isn’t a foreign concept in Rhode Island. Sixteen inches of steady rain flooded many parts of the state, and many homes, in March 2010. Swollen rivers overflowed in areas that were previously unused to flooding. Warwick Mall was under water for days, and a portion of Interstate 95 in Cranston and Warwick was shut down due to excessive flooding.

Since 2018, the state has had six tornado strikes — before that, it took 32 years for the state to amass the same number of tornadoes — and an increasing amount of non-hurricane storm events that, while not that strong meteorologically, still cause plenty of damage.

Although Rhode Island is still nowhere near California and Florida in terms of insurance crises,  Shahaglian told the commission most rates are going up anyway to keep up with inflation.

“In the 45 years I’ve been an insurance agent, the homeowners’ market is the worst I’ve seen,” Shahaglian said. “But I feel blessed I’m not an insurance agent in Florida, Louisiana, Texas or California.”