Steven Senne/AP Photo
Waves crash against houses, March 7, 2018, in Scituate, Massachusetts. About 2,000 Scituate homes are located in a FEMA-designated hazard area.
In mid-March, a massive winter storm, commonly referred to as a nor’easter, pummeled the Massachusetts coast with strong winds and raging seas. Along the shore in Scituate, a town of nearly 20,000 people roughly 25 miles south of Boston, gigantic waves crashed over the town’s seawall and walloped homes perched on the Atlantic Ocean’s edge.
Scituate gets hit by severe winter weather pretty often, so it can be rough going for anyone living on its 21 miles of coastline. Some 2,000 ocean-facing and inland homes are in a FEMA-designated Special Flood Hazard Area. Property owners in this zone must buy federal flood insurance from the agency’s National Flood Insurance Program (NFIP).
Mindful of these unique flooding hazards, Scituate has commissioned climate resiliency assessments—the latest just last year—and while those documents are filled with climate mitigation strategies, there is little to no mention of retreat. Managed retreat, the purposeful movement of people and infrastructure away from risks, is unpopular in Massachusetts coastal communities. Understandably, people do not want to leave their homes. But as storms increase in frequency and severity, and the NFIP moves to have rates reflect an area’s actual risk, the attraction of life on the edge of the ocean also demands that residents seriously consider decisions that were once unthinkable: moving out of harm’s way or paying a higher price to live with the dangers.
The current incarnation of the NFIP may not be sustainable as storms increase in frequency and severity.
Since 1968, the federal government has provided public flood insurance for homes in flood-prone areas that the private sector won’t cover. The current incarnation of the NFIP, however, may not be sustainable as storms increase in frequency and severity. The NFIP is funded through insurance premiums, fees, and surcharges paid by NFIP homeowners, annual allocations for flood-hazard mapping and risk analysis, Treasury Department borrowing, and certain reinsurance proceeds.
Nationwide, flood damage payouts have far exceeded the available funding. Fiscal 2022 fourth-quarter estimates from FEMA show that the NFIP is $20.5 billion in debt to the Treasury Department. A 2019 Government Accountability Office report noted that the NFIP will continue to hemorrhage red ink unless Congress acts to shore up the program.
The average NFIP premium for a home in Massachusetts is $1,294 a year, compared to the national average of $946. A decade ago, a plan to increase annual premiums by 20 percent while simultaneously limiting payouts to homes built in high-flood-risk areas failed to garner support in Congress. The legislation faced major backlash from homeowners who did not want to see their rates increase so drastically.
According to a Boston Globe report, about 2,000 Scituate homes are in a FEMA-designated hazard area and in the past decade more than 500 of those homeowners have filed insurance claims of $1,000 or more. Scituate also ranks highest in the state for reimbursement claims paid by the NFIP: Between 1978 and 2020, 4,601 claims were paid out to the tune of $70 million.
One reason flood insurance rates can increase dramatically is to dissuade people from remaining in flood-prone areas. Using a new risk rating system unveiled in 2021, FEMA has taken some initial steps to steer the NFIP toward solvency. However, current rates still do not reflect the harsh reality of living on the edge of the Atlantic. Only 6.3 percent of Massachusetts NFIP policyholders saw their rates increase by more than $20 per month. But nearly 50 percent of Massachusetts NFIP policyholders saw their rates increase by up to $10 per month under the new rating system. Yet another 38.6 percent saw their rates decrease.
First Street Foundation, a nonprofit climate risk assessment research group, forecasts the strain that the NFIP will face if rates continue to lag behind actual risks. Current flood zone premiums are often out of whack with climate change realities. The report found that 4.3 million American homes face substantial flood risk. If the NFIP insured each of those homes, First Street predicts that current premium rates would need to increase 7.2 times to cover the risk expected in 2051—rates would increase over $7,000 per year for an average Massachusetts home.
A 2018 Town of Scituate Coastal Community Assessment of the “risks and opportunities associated with being a coastal community” found that “Scituate residents see themselves as historically resilient to coastal impacts, but doubts are creeping in about Scituate’s ability to remain resilient into the future.”
“Some residents have expressed the sentiment that they’d like their town and the state to do more to maintain seawalls and stem the impact of climate change in their neighborhood,” says Republican state Sen. Patrick O’Connor, who represents Scituate and other coastal communities. This past September, O’Connor helped secure $6 million from state grants to repair portions of Scituate’s seawall. But even he admits “we’re often playing catch-up” when it comes to climate impacts.
Given the program’s solvency issues and the slow pace of reform efforts, some town homeowners fear that the NFIP won’t help much if and when their homes do flood. NFIP premiums should reflect an area’s flood risk, but if homeowners who live in expensive homes in neighborhoods that suffer repeated damage are not willing to pay premiums that adequately reflect their flood risks, members of Congress will have to consider whether to channel more taxpayer dollars into the program.
Accepting that the area you live in is prone to a major climate change–propelled disaster in the near future is not an easy thing to acknowledge—so managed retreat debate is a conversation that most people in Scituate aren’t ready to have. Which means debates about hiking insurance premium rates and paying for seawalls and other new, pricey resilience measures for constituents are still tricky political maneuvers for federal and state lawmakers. But the ocean is not waiting for people to make up their minds about the real costs of owning property in a coastal flood zone.
