The U.S. Senate voted 72-22 last week to approve the bipartisan Homeowner Flood Insurance Affordability Act with amendments made by the House. The bill curtails flood insurance rate increases that property owners are facing across the country.
Both the National Association of Realtors® (NAR) and the National Association of Home Builders (NAHB) applauded the passage of the bill, which repeals the Federal Emergency Management Agency’s authority to increase premium rates at time of sale or new flood map, and refunds the excessive premium to those who bought a property before FEMA warned them of the rate increase. It also limits premium increases to 18 percent annually on newer properties and 25 percent for some older ones.
Additionally, the bill adds a small assessment on policies until everyone is paying full cost for flood insurance.
“We appreciate the Senate’s swift action on the legislation, which is a responsible and balanced solution to the skyrocketing flood insurance premiums affecting residential and commercial properties that were unintentionally triggered by the Biggert-Waters reforms to the National Flood Insurance Program,” said NAR President Steve Brown in a statement.
The 2012 Biggert-Waters law set out to gradually phase out flood insurance subsidies as a way to make up for the National Flood Insurance Program’s $24 billion debt. As a result, home owners who had received federal aid to pay for flood insurance were being faced with tens of thousands of dollars a year in flood insurance hikes.
President Obama is expected to sign the bill into law when it arrives at the White House.
Source: NAR Real Estate News