 In North Carolina , the storm surge from Isabel washed out a portion of Hatteras Island to form what was unofficially known as Isabel Inlet . Damage was greatest along the Outer Banks , where thousands of homes were damaged or even destroyed . The worst of the effects of Isabel occurred in Virginia , especially in the Hampton Roads area and along the shores of rivers as far west and north as Richmond and Washington , DC . Virginia reported the most deaths and damage from the hurricane . About 64 % of the damage and 68 % of the deaths occurred in North Carolina and Virginia . Electric service was disrupted in areas of Virginia for several days , some more rural areas were without electricity for weeks , and local flooding caused thousands of dollars in damage . 
