SC coastal homeowners will face major insurance hikes from climate risk, report says

Hurricanes. High winds. Heat. Flooding. Wildfires.

Weather disasters are nothing new to the South Carolina coast, but more frequent events are sending hits to the insurance market.

Across South Carolina, homeowners could see between 60% to 203% premium increases within the next decade, with residents paying more for insurance than property taxes.

The state will face the second-most extreme insurance hikes in the country over the next decade, according to a new report from the Coalition for an Insurable Future and Mandala Partners, and a climate crisis is to blame. Coastal communities are facing the highest risk.

States like California and Florida already saw these jumps years ago, and South Carolina is catching up.

“It’s not that Florida and California aren’t going in a bad direction, they’re further along than South Carolina,” said Chloe Demrovsky, Coalition for an Insurable Future member, founder of Edgewood Insights and former president and CEO of Disaster Recovery Institute International. “These problems have been happening and have been surfacing in Florida because of flooding and hurricanes, (and) in California because of wildfires and earthquakes for a long time.”

Extreme flooding in South Carolina

South Carolina has increasingly dealt with extreme flooding from heavy rainfall events, like Hurricane Matthew, Florence and Helene. Sea-level rise is exacerbating flooding during King Tides, also known as sunny day flooding. Intense waves during storms have swept dozens of feet of sand from beaches and eroded dunes, an essential protection against storm surge, requiring multi-million dollar beach renourishment projects.

The eight coastal counties are among the top 10 counties in the state facing the highest premium increases. In a medium climate risk scenario, the counties rank as follows:

• Beaufort, 233% or $9,600
• Jasper, 213% or $5,200
• Georgetown, 199% or $7,100
• Charleston, 102% or $4,400
• Berkeley, 94% or $2,200
• Dorchester, 92% or $2,200
• Horry, 90% or $2,400
• Colleton, 72% or $1,700
• Williamsburg, 62% or $1,400
• Marion, 51% or $1,000

The risk has to do with the resiliency of a home, Demrovsky said. During the building boom between 1950 and 2000, many homes were built cheaply on flood prone land, making them more costly for homeowners in the long run. Resilience of a home largely matches the strength of local building codes.

“The lower the code, the cheaper the build,” she said.

Premium increases and poorer communities

Premium increases also disproportionately affect poorer communities, simply because those communities are often built on low-lying land and are cheaper to purchase. But often those communities become trapped in a cycle of poverty since disasters have a greater impact on less resilient homes, she said.

South Carolina has become the fastest growing state in the nation, and to accommodate population growth, rapid development has taken over.

“A lot of this new building happened in reclaimed marshland, reclaimed streams, ponds, landfills and those areas,” Demrovsky said.

National insurance trends

Homeowners insurance has increased 38% nationwide since 2021, the report said, outpacing inflation and wage growth.

States like Florida, California and Louisiana already have some of the highest insurance rates in the country. Louisiana outpaces South Carolina in premium increases over the next decade, too.

Homeowners insurance could continue to rise another 15-35% by 2035, and 35-107% by 2050, the report said. The U.S. could incur costs of nearly $1 trillion by 2035 from claims.

As insurance premiums rise, more and more homeowners go uninsured, increasing the premiums even further to be able to pay out during disasters.

How does climate risk impact insurance market stability?

Since 1980, the amount of billion dollar disasters from a single event has dramatically increased.

“Insurance was designed for, (when) one house burns down, and all the houses around it don’t burn down in that year, so the premiums go to cover that one house,” Demrovsky said. “But if the whole neighborhood burns at the same time, that’s a colossal payout that can drive the insurance company completely out of business,”

Some insurance companies will refuse to insure a community due to the extreme risk of bankruptcy from a disaster. This has happened in states like Florida and California in recent years. The less affordable homeowner’s insurance becomes, the fewer Americans will be able to buy a home, as homeowner’s insurance is required with a mortgage.

The best thing to combat the damage caused by single events is to build more resilient homes by enforcing stricter building codes, Demrovsky said. Individuals can better protect their savings by considering factors like roof life and flood zone over more affordable, cheaply built homes.

“In the long run, if you do the math, it is more affordable to build better, because that housing stock is going to protect people,” she said.

This story was originally published July 3, 2026 at 5:00 AM with the headline "SC coastal homeowners will face major insurance hikes from climate risk, report says."