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House Moves to Strengthen Flood Insurance Program
In an effort to update and reform the National Flood Insurance Program (NFIP), Reps. Barney Frank (D-Mass.) and Judy Biggert on March 26 introduced H.R. 1682, the Flood Insurance Reform and Modernization (FIRM) Act of 2007.
The measure would allow the NFIP to borrow up to $21.5 billion from the U.S. Treasury for insurance claims from the devastating 2005 hurricane season.
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.
Throughout its 39-year history, the program has been largely self-funding through policyholder premiums, but it sustained a multi-billion dollar deficit from claims following Hurricanes Katrina and Rita.
The FIRM Act would:
- Require greater accountability and financial responsibility from the NFIP
- Raise the 1994 coverage limits for residential flood insurance policies from $250,000 for structures and $100,000 for contents to $335,000 and $135,000, respectively; and raise non-residential property coverage from $500,000 to $670,000
- Direct the Federal Emergency Management Agency (FEMA) to conduct a comprehensive review of the nation’s flood maps to ensure that they reflect accurate risks to home owners
- Require FEMA to submit annual financial reports on the insurance program to Congress
- Phase out subsidies for vacation homes, second homes and non-residential properties
- Require property owners to be notified of the availability of flood insurance and escrow for flood insurance
- Provide additional living expense coverage for temporary housing immediately after a flood
- Increase fines on lenders who do not enforce the mandatory flood insurance policy for federally backed mortgages in the 100-year floodplain
More than 20,000 communities nationwide participate in the insurance program, which currently covers about 4.8 million policyholders.
NAHB will closely monitor the bill as it moves through the legislative process and work with lawmakers to ensure that federally-backed flood insurance remains available and affordable and that the program is financially healthy.
To read the House legislation, click here and enter H.R. 1682 in the box at the center of the page.
For more information, e-mail Scott Meyer at NAHB, or call him at 800-368-5242 x8144.
Mark Your Calendar for the 2007 NAHB Legislative Conference
The 2007 NAHB Legislative Conference provides a unique opportunity for builders to speak directly with their members of Congress and to take a stand on the issues that affect their businesses and bottom line.
The conference is on Wednesday, June 6 and is a day-long event that coincides with the NAHB spring board meeting in Washington, D.C.
Attending the 2007 Legislative Conference offers NAHB members an unparalleled opportunity to:
- Lobby members of Congress to protect your business
- Establish lasting relationships with your elected federal officials
- Share builder concerns in a national forum in Washington, D.C.
- Learn the latest policy developments on the key issues affecting your business
- Demonstrate your industry’s commitment to responsible policies, pragmatic reforms, effective programs and providing the resources necessary to meet our nation’s ongoing housing needs
- Network and share business strategies with your peers
- Learn how to be an effective advocate for your business and your industry
- Make your views known on Capitol Hill
- Do your part to ensure that NAHB’s issues are heard by Washington policymakers
- Galvanize a united front on Capitol Hill
For more information or to register, click here.
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