|
Senate Votes to Renew Flood Insurance Program
The Senate last week voted 92 to 6 to revamp and extend the National Flood Insurance Program (NFIP) through 2013.
With the beginning of the hurricane season just weeks away, the Senate action is a positive development; the 40-year-old flood program is set to expire on Sept. 30 unless Congress reauthorizes it.
The Senate bill differs significantly from House legislation approved last September and the two chambers must now reconcile their differences.
Of note, the Senate bill would forgive a $17.5 billion debt the program incurred during the 2005 hurricane season and fails to add wind damage coverage to the program. Conversely, the House measure has included wind coverage but refuses to forgive the debt.
Unlike the House legislation, the Senate bill also includes mandatory purchase requirements for properties sited behind flood protection structures.
Established in 1968, the NFIP offers affordable flood insurance to home owners and businesses in flood plains and other low-lying areas that otherwise might not be able to obtain coverage.
More than 20,000 communities nationwide participate in the insurance program, which currently covers about 5.5 million policyholders.
As the legislation moves to a House-Senate conference, NAHB will work with lawmakers to ensure that federally-backed flood insurance remains available and affordable and that the program is financially healthy.
Specifically, NAHB will urge conferees to craft a final bill that:
- Retains the wind provisions.
- Does not mandate flood insurance for home owners who reside behind flood control structures such as dams or levees, because the benefits of such compulsory coverage are outweighed by the costs.
- Increases the program’s coverage limits.
- Forgives the flood program’s $17.5 billion debt. The nearly $1 billion in interest that the Federal Emergency Management Agency must pay the Treasury each year to service that debt is raising the cost of insurance premiums and threatening the program’s viability.
For more information, e-mail Scott Meyer at NAHB, or call him at 800-368-5242 x8144.
|
