Most SC property owners will start paying more for flood insurance in 2022. Here’s why
Most South Carolinians will see their flood insurance rates go up thanks to a new policy from the Federal Emergency Management Association that goes into effect today.
FEMA’s National Flood Insurance Program is updating the way it assesses flood risk for policyholders. For years, calculations were made based on outdated flood zone maps from the 1970s. Now, the program will assess each property individually, taking into account factors such as elevation, proximity to water and history of flooding.
These changes will cause rate increases for 74.5% of program policyholders in South Carolina, according to data from FEMA.
The good news is, 66% of those homeowners will see a maximum increase of just $10 a month. Rates will actually decrease for about a quarter of policyholders, and 3.5% of them could save $100 or more a month.
Only 116 policyholders out of 208,559 in the state will see their monthly rates increase by $100 or more..
Ray Farmer, director of the South Carolina Department of Insurance said those who live along the coast will likely see the greatest rate increases. For years, these property owners have benefited from artificially low prices that Farmer said have put FEMA deep into debt.
“Taxpayers have been subsidizing people with flood policies,” he said. “This is an effort to make everything on equal footing.”
Though most South Carolinians purchase flood insurance through FEMA, there is a small but growing private marketplace. Farmer said he believes FEMA’s new policy could encourage more private businesses to enter the marketplace, a change that would ultimately benefit consumers.
Despite the growing costs, Farmer urged existing FEMA policyholders to continue paying for flood insurance. He also encouraged those who don’t have flood insurance to look into it.
“If it rains at your house, you ought to consider flood insurance because it could flood,” he said.
For more information on flood insurance, residents can visit the S.C. Department of Insurance’s website or call its consumer services department at (803) 737-6180.
This story was originally published April 1, 2022 at 9:52 AM.
CORRECTION: Ray Farmer is the director of the South Carolina Department of Insurance. A previous version of this story included incorrect information.
