Homes sit in floodwater in a West Ashley subdivision after the historic October 2015 flood. Staff/File

Nearly a billion dollars in claims have been paid out in South Carolina since the inception of the modern flood insurance program 40 years ago, with the Charleston region accounting for about a third of that money, according to federal data released this week. 

Claims paid out in South Carolina total slightly more than $920 million, the 10th-highest amount among the 50 states. Louisiana topped the list, with $19.6 billion in claims. 

The Charleston region accounts for almost 35 percent of the money paid out in the Palmetto State, with Charleston, Berkeley and Dorchester counties racking up a total of $320.6 million in flooding claims over that period, combined. By comparison, Horry County, the home to Myrtle Beach, received $296.8 million.

The data, publicly available for the first time, comes from the Federal Emergency Management Agency. The agency is the primary U.S. insurer against flood risk though its National Flood Insurance Program, because typical homeowner policies do not cover flooding.

The program is crucial to insuring coastal and riverfront property owners against severe weather, and operates in every county in the state, according to Nick Kremydas, chief executive officer of South Carolina's statewide Realtor association.

"It’s a program that raises a lot of emotion. Most people just assume NFIP is out there to protect the wealthy beachfront property owners, when the fact is the program protects homeowners all over the state," Kremydas said.

The data released Tuesday will help show decision-makers where that protection is most frequently used in the region, though street-level information that would aid prospective home buyers remains out of reach.

“What this literally does is put it all in one place,” said Robert Hartwig, a professor at the University of South Carolina and co-director of the school’s Risk and Uncertainty Management Center. “For insurers, public policy makers, individual home owners, Realtors, all of whom now have a better sense of how to better assess risk in their communities.”

Flood aid deadlines approach (copy)

Flooding around homes in the Carolina Forest community in Horry County, between Conway and Myrtle Beach, in 2015. File/AP

Information Gap

FEMA's South Carolina data includes payments for flooding as early as 1975. It does not include the exact addresses of affected buildings, but it does include ZIP code-level data on where policy-holders received payments.

That means there is still a crucial gap in information for home buyers. Federal privacy law hampers the ability to check the flood claim history of specific properties, creating a situation where a buyer might not be told about a full history of flood risk, or a seller may not know themselves, if the flood happened before they owned the property. 

If a home is flooded multiple times, FEMA will often penalize property owners. That leads to a situation where a new homeowner making a single claim can face penalties from a past they didn't know about before buying. 

“You do see it in some transactions in Isle of Palms, Sullivan’s Island, Folly (Beach) ... when the new buyer goes to apply for insurance, that’s when they get dinged," said Josh Dix, of the Charleston Trident Association of Realtors. 

On the Grand Strand, the coastal region that includes Horry County and Myrtle Beach, repetitively-flooded areas aren't seeing any sort of major change in home buying or selling, said Laura Crowther, chief executive officer of the Coastal Carolina Association of Realtors. The region is one of the state's fastest-growing areas, mostly because of relocating retirees. 

Releasing data with street addresses "would certainly help the buying public make better decisions and have a little more safety and comfort in the decision they're making, and go in with eyes wide open," Crowther said. 

The Charleston region's Realtor group also supports full disclosure of flood insurance claims with addresses attached, Dix said. Flood risk is the third question buyers ask local Realtors, he said, after the quality of the nearest schools and the location of the closest grocery store. 

Still, though there are widely known flooding issues in outer West Ashley, Johns Island, James Island and downtown, the Charleston housing market hasn't shown the effects of that risk, so far. 

"We really haven't seen any real evidence that this is deterring growth in Charleston," said Joey Von Nessen, an economist at USC who studies residential real estate. "We don't know (if) that trend is necessarily going to persist, but for right now, demand in Charleston is strong and we see that in the data throughout this economic expansion."

Insurance Reform

Hurricane Wire is a pop-up newsletter during hurricane season that delivers anyone who lives on the East Coast all the information they need to know as storms brew in the Atlantic and beyond.

Even though it does not list specific addresses, the data will prove useful to the smaller but growing market of private flood insurers, who can use it to decide what to charge customers, Hartwig said. 

The release comes as Congress is considering reforms to the program, which has been in a financially precarious condition since Hurricane Katrina in 2005. The NFIP program was in debt to the tune of $20.5 billion as of last September, even though federal lawmakers erased $16 billion in debt just two years ago. 

At the same time, a recent report in the New York Times showed that across the country, people are buying fewer and fewer federal flood insurance policies, even as increasing global temperatures make rainfall events more extreme and unpredictable. 

That's bad news for the program, because insurance works by spreading risk around a large pool of paying policy holders. The more people who buy into a program, the more financially sound it is, and the less likely it is that a disaster will stress it. 

Recent research has also shown that every dollar spent for mitigation, or protecting against flood damage before it happens, saves $6 in post-disaster assistance.

Reform to the national insurance program introduced this week in the U.S. House of Representatives would allow homeowners to ask FEMA for the full flood claim history of their property and would allow buyers under contract to see the flood claim history of the home they're buying. 

It could also open up a faster pathway for buyouts of repetitively-flooded homes, said Joel Scata, of the Natural Resources Defense Council. 

"Flood insurance can only do so much," Scata said. "There also has to be a provision for reducing flood risk."

J. Emory Parker contributed to this report. 

Reach Chloe Johnson at 843-735-9985. Follow her on Twitter @_ChloeAJ.

Chloe Johnson covers the coastal environment and climate change for the Post and Courier. She's always looking for a good excuse to hop on a boat.

Stephen Hobbs is a member of the Watchdog and Public Service team. He can be reached at (843) 937-5428.

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