The Senate sent its version of a bill that would shore up the state's coastal insurance plan back to the House for a final vote.
The bill would allow the state-created insurance plan known as the Beach Plan to assess a surcharge on homeowners and businesses across the state if a storm generates more claims than the plan can pay.
The Senate backed off a proposal that would have raised the cap for coverage under the plan from $750,000 to $1 million. Senate Leader Marc Basnight, a Manteo Democrat, begrudgingly agreed to the reduction, which was proposed by Sen. Phil Berger, an Eden Republican and the chamber's minority leader.
"He and his colleagues are demanding that it occur," Basnight said. "I hope you are proud of it."
Berger said he moved for the cap because it would be hard for many senators to go back to their non-coastal districts and explain why insurance might be more expensive because million dollar houses were destroyed.
"The idea that this plan covers property up to $1 million, I think, creates a real political problem for many of us who are willing to support a compromise bill," Berger said.
The $750,000 cap would give the bill an easier time back in the House, said Rep. Hugh Holliman, a Lexington Democrat and the chamber's majority leader.
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Re: Senate sends beach bill to House
I just want to lend some perspective here. I have a small house in Brunswick county, walking distance to the beach, not on the beach. It's a small, older home, about 1,100 square feet, and nothing fancy (it was built just to be someone's vacation home in the 80s). Rebuild estimate is $80,000 for which I have coverage.
Since the house is financed, the law requires that I carry The Beach Plan (mostly wind), a separate Homeowners policy, and Flood.
The total of all 3 have over doubled in the last 5 years, which is how long I've owned the house.
I've heard many say that homeowners near or on the beach are getting large subsidies and cheap insurance from the government. Let me assure you, this is not true.
This year, I will pay $4,200 in insurance. That means, all things remaining equal, in 20 years I'll have paid enough insurance totally rebuild my house, whether it's ever damaged or not. And, that's using the absolute highest deductible available for each plan, so they'll never really pay out the whole $80,000. And that's only if my house is totally destroyed.
And, consider that, since the house was built in 1984, it's never had any significant damage from a hurricane. Keep in mind they won't all pay, only the one that is deemed to have the coverage for the cause of damage.
My old house in an inland county had 1 insurance policy that covered everything, payed up to $250,000 to rebuild and cost $525 a year. That means I would have to pay that amount for 476 years before I'd reach the $250,000.
I wish NC law did not require me to have these insurances, but it does. But no one should imagine that these insurance policies are not making money. This is just insurance companies and politicians doing what they do best, which is collect money.
And, by the way, I really don't think taxpayers all over the state should cover the expense of someones beach house, but I truly doubt that's ever going to really happen. And I do think there should be a cap on the value covered.
However, I lived in Charlotte when hurricane Hugo plowed through, which showed hurricanes can make a huge mess inland too. Charlotte suffered heavy damage, and a lot of million dollar houses got damaged, but everyone was covered by their normal homeowners insurance, despite the fact it was still a hurricane as it passed through Charlotte.
So maybe everyone within 200 miles of any coast should have to be on the Beach Plan too, and pay a rate respective to risk.