Grand Strand leaders hope for fix to flood insurance law
Wed, 05 Mar 2014 23:18:51 GMT —
A Congressional bill is headed to the U.S. Senate with the goal of helping residents in flood prone areas.
Homeowners in those areas complained about sharp premium increases. The new legislation would allow sellers to pass along their below-market insurance rates to new buyers.
They would also be able to lower the cap on how much premiums can rise every year.
The bill could help Grand Strand property owners who got "sticker shock" from increases in their flood insurance rates.
Local leaders are worried those rate hikes could impact tourism, so they want Congress to pass a fix soon.
In 2012, Congress passed a bill to reform the flood insurance program, after the government spent billions in emergency aid following Super Storm Sandy.
The result was skyrocketing flood insurance rates for some coastal property owners.
"From about $1,200 a year to $16,000 a year. We have seen other cases where it has escalated to $40 to $60,000 annual flood insurance premium," said Laura Crowther, CEO of the Coastal Carolinas Association of Realtors.
It didn't just hit homeowners. Hotels and rental properties got socked by higher rates, too.
Mayors and county leaders at Wednesday's Coastal Alliance meeting worried those increases could be passed along to tourists, in the form of higher room rates.
"Tourists might decide, Hey, you know we can't afford to go to the coast, we can't afford it. Maybe we need to go to Carowinds, or Six Flags, or Gatlinburg or somewhere, so we would lose business," said Myrtle Beach Mayor John Rhodes.
Rhodes says South Carolina's Congressmen and Senators need to protect tourism and help fix the law.
Crowther says the bill that just passed in the House is a step in the right direction.
It would lower the cap on how much flood insurance rates could rise each year.
"That is a much better solution than just trying to wallop someone with a major insurance bill, potentially an insurance bill that might cost more than the actual property that they're trying to purchase," she said.
Crowther says no one knows how the bill might change, now that it's in the Senate. She says now's the time for people to let Senators know how much this could impact South Carolina.
The Senate could vote on the House version of the bill by the end of the week.