Rich Beck lives nowhere near a river. The Colonial Revival-style house that he has called home for more than 20 years sits on high ground in downtown St. Johnsbury. The nearest running water is a small creek that "you can just step across," he said.
Beck, a 75-year-old retiree, never worried about his home flooding, let alone whether he needed flood insurance. But on July 30, when record-breaking rainfall inundated St. Johnsbury and other places in the Northeast Kingdom, Beck awoke to find his basement brimming with more than eight feet of water. The torrent had streamed down the street leading to Beck's home.
Beck's boiler and water heater were destroyed, as was the model railroad track he had been working on for two decades, meticulously adding miniature figurines and landscapes during his spare time.
Beck already has run up a $2,300 bill from a plumber for immediate repairs. But he still needs to purchase new appliances and deal with the structural damage to his home.
"I'm going to be so financially wiped out from this thing," Beck said. "I had not been planning on anything like this."
As a succession of catastrophic rains and flooding have battered the state during the past two years, a growing number of Vermonters are getting caught short when it comes to insurance protection. Some home and business owners lack adequate coverage. Others, like Beck, who live outside areas officially designated as flood-prone, were never required to purchase flood insurance in the first place.
At a time when flood insurance rates are surging nationally, outdated floodplain maps and inadequate disclosure laws are making it increasingly difficult for residents to determine how best to protect their homes or businesses without breaking the bank.
"Climate change is making insurance less affordable and accessible across the country, and that's going to be a huge problem for your average owner or renter," said Joel Scata, senior attorney for environmental health at the Natural Resources Defense Council's office in Chicago. "People who are living outside those federally mapped flood zones aren't getting the information they need about their flood risk."
In fact, nearly a third of damage claims following calamitous flooding last year was from properties outside federally recognized flood zones, according to Kevin Gaffney, commissioner of the state's Department of Financial Regulation, whose purview includes the insurance industry.
Nancy Tirozzi, co-owner of Papa Tirozzi Bakery & Pizza in downtown St. Johnsbury, has been flooded twice this summer already. On July 30, water rushed from a small, seemingly benign brook behind her popular eatery and carried inches of silt-laden floodwater into the dining room. Luckily for Tirozzi, the kitchen was spared. Friends rushed to help with the cleanup, but Tirozzi expects that repairing the floor and replacing equipment will be costly.
Tirozzi assumed that her insurance would cover the damage, but her broker informed her that she did not, in fact, have flood insurance. The broker never mentioned flood coverage when Tirozzi bought insurance because her business isn't in a federally designated floodplain, she said.
"That was shocking to me," Tirozzi said. "I've always gotten all the insurance that I need, and I wasn't offered this."
Julie Marshall, a paralegal with Legal Services Vermont, said dozens of Vermonters have been seeking legal counsel since their properties were swamped. Their situations vary: Some have conventional homeowner insurance that doesn't cover flooding, others have flood insurance with coverage gaps, while still others lack any coverage, despite intense flooding in their areas. Just last week, Marshall spoke with a client who was dismayed to learn that their flood insurance didn't cover their basement.
"There's a gap of information and a gap of knowledge for everyday Vermonters about what insurance they need and what it will actually cover, especially in light of all the flooding last summer and this year," Marshall said.
Unlike homeowners' insurance, which typically does not cover flooding, flood insurance is distributed through the federal government's National Flood Insurance Program, which was established in 1968, at a time when few private companies offered flood coverage because it was viewed as too risky.
The program, which is managed by the Federal Emergency Management Agency, enables property owners and renters in participating communities to purchase flood insurance as long as those communities adopt and enforce regulations aimed at reducing flood damage. Nearly 90 percent of towns and cities in Vermont participate in the NFIP.
Private insurance companies sell NFIP policies directly to consumers and manage them, while FEMA retains responsibility for underwriting that coverage.
Nationally, more than half of homes covered by NFIP policies are in "Special Flood Hazard Areas," which are assigned a 1 percent chance of flooding in any given year. Homes in these areas that are financed with a federally backed mortgage are required to have flood insurance.
Flood insurance rates are determined based on the characteristics of each property, including its elevation and distance from a water source. In 2021, the NFIP modified its formula for determining flood insurance ratings to consider other factors besides FEMA's floodplain maps, which many experts say are outdated and incomplete. Still, the new calculations increase the cost of flood insurance for most people.
The average cost of residential flood insurance in a flood zone in Vermont is around $2,700 to $3,000 a year, according to Gaffney, but the sum can vary greatly depending on location, deductible levels and other factors. And as the frequency and severity of flooding increase each year across the country, that number is going up for average consumers and those in high-risk homes.
That added cost is bad news in a state already experiencing a shortage of affordable housing. The true cost of purchasing a home at risk of flooding — a growing share of the housing stock in Vermont — is significantly higher, say those in the field.
The cost of flood coverage "takes so much of the buying power from the purchaser," said Peter Tucker, advocacy and public policy director for the Vermont Association of Realtors. "Your total cost of ownership is driven up dramatically."
Some Vermonters who are required to have flood insurance simply cannot afford it. That includes older Vermonters whose mortgages are paid off and who may never have been required to carry flood coverage but suddenly find that their property is in a floodplain.
According to Gaffney, the share of Vermont households with flood insurance policies hovers around 2 to 4 percent, which mirrors the national rate. Gaffney hopes the state's take-up rate increases to 5 to 10 percent.
Vermont did see the second-highest surge in the country last year in the number of active flood insurance policies, with a 7 percent increase.
Meanwhile, there has been a state-level push to sharpen Vermont's flood disclosure laws. In March, legislators approved a bill that requires homeowners and landlords to disclose if their property has been previously damaged by flooding or is located in a federally designated hazardous floodplain. The Democrat-controlled legislature later overrode a veto of the bill by Gov. Phil Scott, a Republican.
"If someone is told that the house they're about to buy has flooded, even if it's not in a federally designated floodplain, that gives them a very integrated indication of the risk that they might be facing," said Scata, of the Natural Resources Defense Council.
However, Scata thinks that's still not enough. Vermont's flood disclosure rating — as calculated by the council — bumped up from an F to just a C+.
Scata says the new law should also require homeowners and landlords to disclose whether the property was ever required to carry flood insurance. That's especially important, he and other advocates assert, because once a home has received FEMA assistance, the owner is required to carry flood insurance forever. Failure to do so can result in FEMA refusing to help in a future disaster.
For renters and homeowners wondering how best to prepare for flooding, Scata recommends looking at property-level projections put out by First Street Foundation, a nonprofit that calculates climate risk. Its data, available for free at firststreet.org, account for the more recent effects of climate change in making projections — unlike FEMA's.
Gaffney, of the state's financial regulation department, also warns Vermonters against making insurance decisions based on statistical projections that place storm frequency in the hundred- or thousand-year time frame.
"These statistical monikers give a false sense of security that this happened and it won't happen again in our lifetime, and the reality is, we don't know," he said.
Gaffney recommends that Vermonters compare costs of flood insurance. For properties outside a floodplain, the rate could be relatively low. He also suggested looking at rates from Lloyd's of London, a marketplace for insurance and reinsurance that sometimes offers flood insurance at a lower rate than the NFIP.
Finally, experts urge Vermonters with flood insurance to examine the details of their policy to make sure it covers what they think it does. Assistance from legal professionals can help.
"If something is covered or not can hinge on what may seem like, frankly, ridiculous details, like whether water entered the house because it was wind-driven or through the ground," Daniel Schmidt, an attorney with Vermont Legal Aid, said.
Beck, the St. Johnsbury homeowner, has been mucking out his basement with the help of neighbors and friends. Supporters created a GoFundMe campaign to help cover his expenses. Still, he is unsure whether he'll purchase flood insurance or be able to recover financially from the flooding. He said adding a monthly flood insurance payment feels out of reach right now.
"It's very expensive, as I understand," Beck said. "Plus, I don't plan on living another thousand years."