TODAY: House to Pass Flood Insurance Relief
Bill Lowers Premiums, Updates Flood Maps, Fosters Competition
WASHINGTON — The U.S. House today is expected to pass sweeping legislation backed by Congressman Vern Buchanan to reauthorize the National Flood Insurance Program (NFIP), which provides coverage to nearly 2 million Floridians.
The 21st Century Flood Reform Act reauthorizes the program for five years and gives states more flexibility to regulate their own private insurance markets to increase competition and consumer choice. The program is set to expire this year.
“Floridians know all too well the devastating risks posed by extreme weather and flooding,” Buchanan said. “That's why it is so important for Floridians to have access to affordable flood insurance that allows them to better protect their families, homes and businesses. Today's bill provides the common-sense reforms homeowners need now more than ever.”
The 21st Century Flood Reform Act (H.R. 2874) would:
- Decrease from 18 to 15 percent the cap on any individual's annual rate increases;
- Provide affordable NFIP coverage by limiting residential risk premiums to $10,000 per year and lowering the amount rates can be increased annually;
- Authorize $1 billion for individuals and communities to protect their homes and mitigate their risk against floods and other natural disasters before they strike;
- Keep the program fiscally sustainable by requiring the program to build up its Reserve Fund to avoid NFIP taxpayer bailouts. The NFIP is currently $35 billion in debt after Hurricanes Harvey, Irma and Maria;
- Improve outdated and inaccurate flood maps by allowing communities to create their own alternatives to existing NFIP maps;
- Allow for private market participation as the majority of Florida single-family homes – 77 percent – could see cheaper premiums with private insurance than under the NFIP according to a study by Milliman, an actuarial services company.
The 21st Century Flood Reform Act is backed by the National Association of Realtors, the National Association of Home Builders, the Property Casualty Insurers Association of America, the Mortgage Bankers Association and the National Association of Mutual Insurance Companies as well as many others.
As of January, there were approximately 1.8 million flood insurance policyholders in Florida – accounting for nearly 40 percent of insurance policies nationwide. The Sunshine State is second only to California for overall risk of natural disasters, with 6.7 million homes listed in the “high or very high” risk categories, according to RealtyTrac, a housing data company. It also leads the country with the most homes at risk for hurricanes.
Buchanan also noted that with an average elevation of just 100 feet above sea level, Florida is particularly prone to flooding. Even a few inches of precipitation can cause flooding in certain areas across the state and cause tens of thousands of dollars in damages.
Buchanan has long been a leader in addressing problems with the NFIP.
He recently convened a meeting of the bipartisan Florida congressional delegation to discuss the 21st Century Flood Reform Act while it was being written. The Florida delegation has served as a major driving force to address skyrocketing increases in flood insurance premiums in recent years.
Buchanan was an original co-sponsor of the Homeowner Flood Insurance Affordability Act of 2014 (H.R. 3370), which was signed into law by President Obama and provided immediate relief and long-term certainty for hundreds of thousands of policyholders across the country, including thousands of individuals in Sarasota and Manatee Counties.