N.C. braces for flood insurance rate surge under new building code

Thousands of coastal North Carolina residents could see insurance rates surge this fall as state regulators weigh higher insurance costs against the rising cost of protecting homes.

The North Carolina Building Code Council has balked at new international building codes for wind-borne debris. The code would require protective plywood panels, hurricane shutters or expensive shatter-resistant windows on new homes as far inland as Burgaw, about 25 miles away from the ocean.

Currently, only new homes within 1,500 feet of the ocean shoreline must have the added safety features.

Council members say the new regulations, if adopted, will price middle- and lower-income residents out of the housing market. Developers claim the code could add thousands of dollars to the price of new homes.

“We just have to look at this extremely carefully because affordable housing keeps going up, and suddenly it isn’t so affordable anymore,” said Dave Smith, a Wilmington custom-home builder and chairman of the building council’s residential standing committee.

Meanwhile, without the new code, North Carolina residents are poised to pay more for their flood insurance. The lack of new regulation will dock municipalities discount points awarded by the National Flood Insurance Program’s Community Rating System.

Policyholders in Wrightsville Beach, who currently receive a 25 percent discount, are slated to drop to 10 percent in October. In Ocean Isle Beach, insurance discounts will drop from 15 percent to 10 percent.

The North Carolina Department of Insurance, backed by the insurance industry, would like the council to adopt the international code. South Carolina adopted the code two years ago. The state adopted it in part because coastal communities protested the loss of flood insurance discounts, said Gary Wiggins, administrator for the South Carolina Building Codes Council.

Wiggins said builders have adapted by designing homes with less glass and are now using the shatter-resistant glass as a selling point.

“That added security factor is what a lot of buyers in the coastal areas are now looking for, especially with insurance rates already so high,” Wiggins said.

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