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PIA Praises House for Passing NFIP Reform, Urges Quick Senate Action

PIA praised the House of Representatives for passing the Flood Insurance Reform Act of 2011 (H.R. 1309) on July 13 to extend the National Flood...
July 19, 2011

PIA praised the House of Representatives for passing the Flood Insurance Reform Act of 2011 (H.R. 1309) on July 13 to extend the National Flood Insurance Program (NFIP) for a full five years and enact key reforms to put the program on a firm financial footing. The vote was 406-22.

Among reform provisions, the bill phases in risk-based premiums, and phases out subsidies for certain properties, including high-risk buildings subject to repeat claims and confirms FEMA's authority to utilize private reinsurance in lieu of taxpayer exposure to mitigate risk.

The House defeated an amendment by Rep. Jeff Flake (R-Ariz.) that would have stripped provisions allowing the Federal Emergency Management Agency (FEMA) from being allowed to offer optional and actuarially priced business interruption (BI) and additional living expenses (ALE) coverage. The vote was 118-305. "Since these coverages are only offered in the private market on a covered peril basis, this amendment would have placed severe restrictions on their availability and made NFIP policies less viable," said Becker. PIA opposed the amendment.

Lawmakers also voted overwhelmingly to defeat an amendment offered by Rep. Candice Miller (R-Mich.) which would have abolished the NFIP by January 2012. PIA opposed the amendment. PIA encourages the Senate to act quickly to pass H.R. 1309, well before the NFIP's scheduled expiration in September.

UPDATE:  The Senate Banking Committee has finished an 88 page draft flood insurance reform bill. PIA is working with Members of the Senate to address concerns prior to the bill being introduced. The Committee is considering a mark-up as early as next week.

See PIA's Flood Insurance Statement: PIA Statement on Passage of H.R. 1309 (PIA 7/13/11)

Read PIA's comments in flood article: Industry Urges Senate to Follow House on NFIP (National Underwriter 7/13/11)

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