Auto Insurance Quote | Slade column: Can insurance discounts pay for new roofs in South Carolina coastal areas?

Auto Insurance Quote

What homeowner wouldn't want a free roof replacement, right?

I've written hundreds of personal finance columns, and the largest response I've seen was to columns about South Carolina's Safe Home program, which can help people pay for roof replacements. That program has not been taking new applications since mid-2015, but another option appears to be emerging.

Former S.C. Insurance Commissioner Eleanor Kitzman is among the principals of a company, MyStrongHome, that seeks to do for hurricane mitigation upgrades — primarily roof replacements — what leasing has done for solar power. That is, the company intends to help homeowners finance the work by connecting the improvements to insurance discounts, so that a homeowner could end up with little out-of-pocket cost.

And, as with solar panels, the concept is that once the improvements are paid off, the homeowners would enjoy ongoing savings, in this case from insurance discounts for fortifying a home against storm damage. Not to mention, they would have a new roof and less potential for damage.

Unlike the Safe Home program, I have no personal experience with MyStrongHome, and it's relatively new. It is an intriguing concept, though, and the company is now operational in South Carolina, Louisiana and Alabama, offering services in coastal areas where hurricane risks and insurance premiums are high.

MyStrongHome is neither widely available, nor is it right for everyone, but I'll lay out the concept and some pros and cons. Here's how Kitzman described it to me:

"MyStrongHome will conduct an on-site inspection and evaluate each prospective home for viability, select specially trained and certified contractors who use tested, proven construction standards and materials, finance the cost of construction and, because of the reduced risk of loss to the insurance company, provide lower cost homeowners insurance. In many cases, the homeowner's combined monthly payment for insurance and construction financing will be no more than they currently pay for homeowners insurance alone."

How could that be possible? The financing model is based upon the homeowner making improvements necessary for the home to attain a bronze-level "fortified" rating from the Insurance Institute for Business and Home Safety, and then insuring the home with a MyStrongHome partner that offers big discounts for such mitigation measures.

Many insurance companies give discounts for making homes more damage-resistant because that reduces their risk. For example, the Safe Home work on my home — a hurricane-rated roof with some extras such as better nailing and seam-taping — earned me a 15 percent insurance discount.

MyStrongHome, however, advertises insurance discounts as high as 48 percent. The company's model depends on homeowners switching their coverage to MyStrongHome insurance partners SageSure and Federated National Insurance Co.

Regardless of MyStrongHome, a homeowner who pays for qualifying home-fortification measures in South Carolina should expect to get an insurance discount, as well as a state income tax credit of up to $1,000 for out-of-pocket costs for making the home more disaster-resistant, and a state tax rebate for up to $300 of sales tax paid for the materials. I claimed those tax breaks when I paid for a new, stronger roof through the Safe Home program, for example.

The big difference with MyStrongHome is the concept of financing the improvements and the cost of home insurance as one payment, so that insurance discounts help cover the cost, over seven years.

For now, the company is in the "soft launch" stage, Kitzman said. That means they're open for business for customers in limited, coastal areas where insurance costs are high — including the greater Charleston and Myrtle Beach areas in South Carolina — but the company hasn't done any marketing, so you're unlikely to have heard of them.

To find out more, take a look at the MySafeHome website. If you're a homeowner who has used this company, I'd be interested in hearing about your experience. 

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