Flood Insurance in North Carolina

The eastern part of North Carolina is exposed to flooding from coastal erosion and storm surges after hurricanes and tropical storms. While you might be further from the Atlantic in the western areas of the state, you’re never totally safe from flooding. 

Flash floods and mudslides after heavy rains imperil mountainous regions of North Carolina. And, the Federal Emergency Management Agency (FEMA) reports that 100% of every county in every state can suffer from inland flooding.

We created this guide to help homeowners find the best flood insurance in North Carolina to protect their properties. 

The average cost of flood insurance in North Carolina is $1,363 under the National Flood Insurance Program. The program’s Risk Rating 2.0 methodology increased North Carolina flood insurance rates by about 72%, up from $791 annually before 2021 to $1,363.

The NFIP is the largest flood insurer in the country, but it’s not a typical insurance company. The NFIP is a government program managed by the Federal Emergency Management Agency (FEMA). FEMA runs the program at a loss in an attempt to cover as many citizens as possible with affordable flood coverage.

Unfortunately, flooding risks are extensive nationwide and are worsening over time. The NFIP recalibrated its rate calculation method to more accurately reflect property flood risks in an effort called Risk Rating 2.0. RR 2.0 rates increased premiums for many policyholders.

The table below shows flood insurance rates in North Carolina by county before and after RR 2.0 premiums take full effect.

RR 2.0 rates became active for all new NFIP policyholders who got a policy after October 1, 2021. Existing policyholders have been phased into the new rates since April 1, 2022. The NFIP limited the rate increase you can experience at 18% annually, so it may take some time to realize your RR 2.0 rate, depending on your increase.

The cheapest flood insurance in North Carolina per year under RR 2.0 will be found in:

Every county other than these has average premiums above $1,000 annually. 86,000 NFIP policyholders will have rate increases under RR 2.0. But, over 21,000 people are experiencing a rate decrease, as well.

Despite the statewide increase in flood premiums, North Carolina remains one of the cheaper states in the country for flood coverage. Only 13 states have cheaper average flood insurance rates.

Flood insurance in North Carolina financially protects your home and belongings from flood damage. If a flood, such as a mudslide, storm surge, flash flood, or coastal erosion, damages your home, your insurer can reimburse you.

The coverage in flood insurance policies typically looks as follows: 

Flood insurance policies normally provide limited coverage for basements due to the likelihood of a basement suffering damage during any flooding event. NFIP policies won’t cover most items in a finished basement.

You should consider coverage from private flood insurance companies in addition to the NFIP when looking for the best flood insurance in North Carolina. Private plans can have higher coverage limits at competitive rates in some areas.

The NFIP simply can’t afford to cover all policyholders fully. As a result, NFIP policies are capped at $250,000 in building coverage and $100,000 in contents coverage for all single-family homes. 

While the limits are restrictive, the NFIP is available in most areas, including especially flood-prone locations where a private company may charge extremely high rates or not offer coverage at all. 

Also, the NFIP won’t ever non-renew you (unless you stop paying). A private insurer can non-renew your policy if it deems your property too risky. 

However, if you find affordable coverage from a private company in your area, you can look forward to higher limits and additional coverages. 

Private flood insurance plans often offer building coverage limits exceeding $1 million and contents coverage limits of several hundred thousand dollars or more. They can also have additional protection not found in NFIP policies, such as loss of use coverage. 

It can’t hurt to look for quotes from private flood insurers, especially if your house exceeds $250,000 in value. The best flood insurance in North Carolina for your circumstances may come from a private company. 

Generally, you can’t combine hurricane and flood insurance in North Carolina. While flood insurance would cover storm surges in many cases after a hurricane, you typically need two separate policies for total protection.

Homeowners insurance covers most instances of hurricane damage, such as wind and debris damage. Home insurance might also cover water damage during a hurricane, like if rain starts pouring in after the wind rips off part of your roof.

But, homeowners insurance never covers flood damage. In coastal areas, storm surges from rising waters during a hurricane or tropical storm can flood your home and ruin all your belongings. Even though it occurred during a hurricane, this damage would be excluded in just about all cases.

This is because you need flood insurance to cover flood damage. Flood insurance can cover storm surges, mudslides, and much more. Floods are more common and costly than you might imagine. The average flood insurance claim is roughly $30,000 more than the average home insurance claim.

Thus, homeowners insurance companies exclude flood damage because they can’t usually afford to factor it into premiums. As a result, you need two separate policies, homeowners insurance, and flood insurance, to be covered for both in North Carolina.

Flood insurance rates in North Carolina rose from $7 to $1,363 from the NFIP. But, not every policyholder’s premiums will increase. Several factors that make your home more or less susceptible to flooding affect the cost of flood insurance in North Carolina. 

Location: your home location is a primary determinant of your premiums. FEMA creates flood hazard maps for the country,  and if your home is in a FEMA-designated flood zone, your house has greater chances of suffering flood damage and having higher premiums. You can check your flood zone with a flood insurance rate map in North Carolina provided by FEMA.

Homes in high-risk flood zones, called Special Flood Hazard Areas (SFHAs), generally have the highest rates. These are often near bodies of water and begin with A or V on flood maps. You can check your food zome at FEMA’s Map Service Center.

According to FEMA, 99% to 100% of NFIP policyholders in the following counties are at risk of suffering storm surge damage:

Elevation: flood insurance companies examine the first-floor height of your home and its height relative to nearby water bodies to determine if your home is susceptible. Naturally, higher homes above ground are less likely to suffer flood damage.

Home characteristics: specific characteristics of your home’s construction also impact rates. Having existing flood mitigation measures, like flood vents and sump pumps, can lower premiums. House construction materials are also relevant. Masonry homes generally withstand floodwaters better than wooden frame houses and may have lower premiums.

Flood insurance isn’t required by law in North Carolina. But, mortgage lenders mandate certain homeowners to carry flood insurance as a condition of their home loan.

Mortgage lenders must protect their investments, so they require homeowners to carry home insurance. But, home insurance doesn’t cover flood damage. Thus, lenders also require homeowners in FEMA-designated high-risk flood zones (SFHAs) to have flood insurance.

Banks accept NFIP and private coverage as long as the policy limits reach your home’s value or max out at the NFIP’s $250,000 if necessary.

Yes, the National Flood Insurance Policy has over 73,000 active flood insurance policies for single-family homes in North Carolina and over 139,000 plans in total at the inception of Risk Rating 2.0. A smaller number of people also have private flood insurance.

Flood insurance is a good idea even when you’re not required to have coverage, as floods are quite possible even in low-risk flood zones. FEMA reports every policyholder in the state has a chance of experiencing inland flooding, and thousands of properties in North Carolina are exposed to storm surge and coastal erosion risks.

You should get flood insurance quotes in North Carolina from private companies and the NFIP when looking for the best coverage at the best price. At Clovered, our job is to make finding the right insurance easier for you. We’d love to help you find the coverage you need at the price you want.

You can submit our flood insurance quote form to find rates from private flood insurance companies in North Carolina. It takes only minutes to fill out, and one of our team members will get back to you with your insurance options as soon as possible.

You can also quote and bind with a licensed agent over the phone by calling us at 833-255-4117 during business hours. Feel free to email us, too, at [email protected].