More than 1.2 million homes in North and South Carolina sit outside government-designated flood zones, and that could lead to vast uninsured losses during Tropical Storm Florence, report says

A house in New Bern, North Carolina, with flooding from Neuse River on September 13.

caption
A house in New Bern, North Carolina, with flooding from Neuse River on September 13.
source
Eduardo Munoz/Reuters

  • A number of homes in North and South Carolina at risk of flooding during Tropical Storm Florence, even though they sit outside of federally designated flood zones.
  • While some homeowners living in official floodplains are required to have flood insurance, others – including those who own some of the 1.2 million homes that sit outside the flood zone – are not.
  • Last year’s Hurricane Harvey caused $17 billion in damages covered by insurance and $40 billion in losses that were uninsured

Some homes in North and South Carolina at risk of flooding during Tropical Storm Florence sit outside federally designated flood zones.

While some homeowners living in official floodplains are required to have flood insurance, others – including those who own the more than 1.2 million homes that sit outside the flood zone – are not, and that could lead to vast uninsured losses as Florence inundates the region, according to disaster research analyst Chuck Watson, who was cited in a CNN report published Friday.

Heavy rainfall has already taken a toll on the region, and rescues got underway on Friday. Florence was downgraded from a Category 1 hurricane to a tropical storm Friday. The National Hurricane Center said catastrophic flash floods were likely in areas of both North and South Carolina.

At least five people have died, according to multiple news reports on Friday.

how hurricane forms infographic

source
Shayanne Gal/Business Insider

The vast majority of homes in the Carolinas don’t have federal flood insurance, CNN reported Friday. Only about 340,000 homes out of a total of about 7 million in the two states have flood insurance, CNN said.

Additionally, roughly 800,000 homes in North Carolina and 430,000 in South Carolina located in low-lying areas or close to rivers are in danger of floods, even though they sit outside of federally declared flood zones.

Last year’s Hurricane Harvey caused $17 billion in damages covered by insurance and $40 billion in losses that were uninsured, Watson said.

Perhaps inspired by last year’s Harvey, Irma and Maria, flood insurance across the country grew 3% from the previous year to 5.1 million having flood insurance.

Currently, fewer homeowners in North and South Carolina own flood insurance than they did five years ago. In North Carolina, the number of flood insurance policies dropped by 3.6% since 2013, and 1.2% in South Carolina, according to an analysis of government data cited by The Wall Street Journal.

Robert Hartwig, a risk-management and insurance professor at the University of South Carolina, told The Journal: “Residents of these states are materially less prepared than they were in the past to deal with the financial consequences associated with major flooding events.”