THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Sunday, March 5, 1995 TAG: 9503020185
SECTION: CAROLINA COAST PAGE: 15 EDITION: FINAL
COLUMN: Real Estate
SOURCE: Chris Kidder
LENGTH: Medium: 83 lines
Two columns I wrote about the National Flood Insurance Program brought several requests for copies from readers who missed one week or the other - and a letter from Malcolm K. Fearing III, Outer Banks Insurance Agency.
Fearing pointed out some important omissions and I'd like to pass them on.
The National Flood Insurance Reform Act of 1994, signed into law on September 23, 1994, eliminates reimbursement for moving or demolishing erosion-threatened homes under the Upton-Jones amendment. However, claims can still be filed until September, 1995.
Homes qualifying for Upton-Jones benefits must be insured. Insurance can be through NFIP or through private, NFIP-approved providers.
``You missed several changes that would be going into effect as of March 1, 1995,'' wrote Fearing. ``Flood insurance will have higher limits of coverage available and NFIP will institute a 30-day waiting period for changes that are not the result of a purchase of a home.''
The 1994 reforms increased residential coverage up to $250,000 for the dwelling and up to $100,000 for contents. It also limits the average premium rate increase in any one 12-month period to 10 percent for properties within a given risk classification.
Fearing also wanted readers to know that privately underwritten flood insurance is now widely available for property owners restricted from buying NFIP coverage under the Coastal Barrier Resources Act of 1982.
And he passed along a recent clarification of the ``seasonal dwelling'' definition from the North Carolina Insurance Underwriting Association.
NCIUA administers the Beach Plan, the primary source for wind damage coverage along the coast.
In the past, insurance agents have misinterpreted the state's definition of a primary residence, says Don Stauffacher, the Beach Plan's assistant manager. That definition requires owners or tenants to ``utilize the dwelling as their primary residence for three or more consecutive months.''
But what the definition doesn't include, says an NCIUA bulletin dated January 1995, is rental properties occupied each week by different tenants. Or dwellings occupied by owners or tenants only a few days each month for three or more consecutive months. Or dwellings occupied for the summer by a spouse and children while the other spouse remains at the normal residence.
The only difference in a primary residency policy and a seasonal dwelling policy under the Beach Plan is vandalism coverage. Premiums for seasonal dwellings cost roughly 13 cents more per $100 of coverage.
``Because all agents can sell our product, there's been pressure on the agents to mis-rate properties to gain a price advantage,'' Stauffacher said. For a policy covering $150,000, the additional cost for a seasonal dwelling is under $200. ``It's not that much,'' he says, ``but it's enough to make a competitive difference.''
``According to the North Carolina Rate Bureau, there can only be one primary residence,'' he said. As of Feb. 1, agents have to document primary residency with names and dates of occupancy. Policies written on or after that date that are mis-rated will be subject to cancellation.
Mis-rated policies written before Feb. 1 will be honored until time for renewal, said Stauffacher.
Mark your calendars now for the Outer Banks Home Builders Association annual Parade of Homes: April 20-23.
Betty Canina, OBHBA executive officer, expects 20 houses - including two remodeling projects and one steel-framed house - to be open to the public. The houses range from $79,000 to $825,000.
Tickets for the parade cost $5 per person and are good for all four days. They go on sale April 1 at the OBHBA office and several area retail stores or they can be purchased at the door of any parade home.
Most Outer Banks subdivisions don't have model homes. The parade offers a once-a-year chance to see the work of more than a dozen builders. You'll see state-of-the art technology, the latest decorating trends, and a variety of beach building styles and floor plans.
It's your chance to look without the pressure of a sales agent at your elbow. Houses are staffed, however, so if you have questions someone is there to help. Having been a Parade of Home judge for the past two years, I can tell you that it's a show not to be missed. MEMO: Chris Kidder covers Outer Banks real estate for The Carolina Coast. Send
comments and questions to her at P.O. Box 10, Nags Head, N.C. 27959.
by CNB