Flood Payouts to Rhode Island Homeowners Were 417 Times Higher in 2023

Severe flooding caused the National Flood Insurance Program (NFIP) to pay out $4.6 million to Rhode Island homeowners in 2023, findings show. That figure is 417 times higher than the $11,000 paid for flood claims in the state in 2019.

Rhode Island experienced more than 50 major flood events last year, yet the number of flood insurance policies in the state has grown by only 1.5% since January 2023, according to the Federal Emergency Management Agency. Currently, Rhode Island has 11,500 policyholders contributing to a $3.2 billion safety net.

And while Rhode Island has seen a dramatic increase in losses due to severe flooding, the state is hardly alone. It’s an example of the challenges states are facing all along the Eastern Seaboard. In 2023, the NFIP paid out over $900 million in claims. Florida received more than two-thirds of that amount, with a staggering $629 million payout in 2023.

FEMA oversees the NFIP, which provides tax-funded flood insurance to policyholders. As of 2022, the NFIP was over $20 billion in debt to the federal government.

Climate change linked to increased flooding

Experts in Rhode Island point to climate change as the cause of flooding issues.

“When we’re looking at climate change, and preparing Rhode Island for the impacts of climate change, we have to look at sea-level rise and more violent surges from the ocean,” Terry Gray, director of the Rhode Island Department of Environmental Management, told WPRI. “That leads to river flooding and neighborhood flooding like we’ve seen in the upland parts of the state. Both are equally problematic.”

Average temperatures in Rhode Island have warmed by more than three degrees over the past century due to climate change, according to the National Centers for Environmental Information (NCEI). Higher temperatures result in more frequent and volatile storms, which increase the sea level and coastal flooding, according to the NCEI.

Rhode Island’s exposed coast also makes it vulnerable to extreme weather events. A report by the National Oceanic and Atmospheric Administration (NOAA) found that sea levels are projected to rise between 1 and 4 feet by 2100.

A sea level rise of 2 feet would more than triple the frequency of dangerous coastal flooding, according to the NOAA.

The financial effect on homeowners

Rhode Islanders pay $​963 annually for flood insurance on average, according to Insurify data. The national average is $806 per year.

In 2022, WPRI found a 10% drop in active flood insurance policies after FEMA rolled out its Risk Rating 2.0 system.

Risk Rating 2.0 looks at factors such as the likelihood of flooding in an area, building type, area elevation, and the replacement cost value when determining the risk rating for a particular area. These metrics caused flood insurance rates to increase for 60% of Rhode Island policyholders.

Federal law caps NFIP rate increases at 18% yearly. This helps mitigate extreme price fluctuations.

But flood insurance isn’t the only coverage seeing a hike in rates. An Insurify report found that Rhode Island is also one of the top 10 most expensive states for car insurance.

This is due, in part, to drivers with comprehensive insurance submitting more claims when their vehicles sustain flood damage, according to Insurify data.

What’s next: Protecting homes and assets

As statewide flood payouts increase, some Rhode Island towns are taking proactive measures to mitigate flood damage and stem future claims.

East Providence has started buying people out of homes located in high-risk areas, and Warren is moving homeowners from low-lying streets to higher ground. The state says it plans to turn these areas into a flood buffer, creating a wetland to naturally store the extra water.

Rhode Islanders who don’t want to leave their homes, or don’t have the option to, should consider flood insurance to protect themselves from a future event. Standard homeowners insurance doesn’t cover flooding. Homeowners can buy flood insurance through the NFIP or private insurance companies.