A lot of Wrightsville Beach residents and prospective beach home buyers are wondering what is going on with the Flood Insurance changes. Many are fearful of rising premiums. As of today, the Homeowner Flood Insurance Affordability Act was passed through Congress and the President is expected to sign it into law.
This act is an amended version of the Biggert-Waters Flood Insurance reform introduced in 2012 which was an effort to balance the budget of the National Flood Insurance Program (NFIP). The NFIP is estimated to be in $24 billion of debt, largely contributed by damage claims from super storms Katrina and Sandy. Compounding the budget deficit is the fact that insurance premiums have been subsidized since the program’s inception 50 plus years ago. Also, increased popularity to live in higher risk environments like the Carolina coast has put additional strain on the program.
So what does this mean for Wrightsville Beach homes or waterfront property along the intracoastal waterway? Premiums can rise in the next 1-3 years, but primary residences built after 1975 are capped at 18% increase per year. If built before 1975, there is an 18% ceiling. If you own a second home or commercial property, the annual increase is capped at 25%. There is also grandfathering for homes in their current flood zone designations so existing home owners are not saddled with the costs of these new insurance changes.
Whether looking to buy or sell at Wrightsville Beach, it is more important than ever to look closely at flood insurance during your diligence time of the transaction. Our team will make sure to put you in touch with our preferred Insurance Agents so you can make the best judgment call with your real estate.