A bipartisan bill cosponsored on Dec. 11 by U.S. Rep. Maria Elvira Salazar (R-FL) would ensure that the Federal Emergency Management Agency (FEMA) allows homeowners to maintain flood insurance coverage outside the National Flood Insurance Program (NFIP).
The Continuous Coverage for Flood Insurance Act, H.R. 6620, which is sponsored by U.S. Rep. Kathy Castor (D-FL), aims to help lower flood insurance costs for homeowners at a time when they face rising premiums and limited insurance options, according to Rep. Salazar.
“Now more than ever, Miami residents and Americans nationwide deserve real choice and affordable coverage in the flood-insurance market,” Rep. Salazar said. “By opening the door to greater private-sector involvement, the Continuous Coverage for Flood Insurance Act will lower the burden on U.S. taxpayers and provide stronger, more reliable protection.”
In 2012, Congress enacted the Biggert-Waters Flood Insurance Reform Act to reform the NFIP. Among other reforms, the law required federal lending institutions to accept certain non-NFIP insurance policies.
As a result of the law, a final rule was issued in February 2019 regarding the acceptance of non-NFIP insurance, which took effect on July 1, 2019.
However, many consumers are unable to take advantage of the non-NFIP insurance policies because the NFIP currently requires continuous coverage to be eligible for grandfathered rates, but only counts the time in an NFIP policy.
If a policyholder chooses to leave the program and return later, the NFIP will charge the full, non-grandfathered rate — even if the policyholder decides to obtain a non-NFIP insurance policy that complies with the new rule, according to information provided by Rep. Salazar’s staff.
“Our bipartisan legislation empowers consumers with more options by allowing access to private flood insurance, without penalty,” said Rep. Castor. “I’m pleased to work with my fellow Floridian, Rep. Maria Salazar, to ease cost burdens on hardworking Floridians and expand consumer choice in continuous flood insurance coverage.”
H.R. 6620 has been referred for consideration to the U.S. House Financial Services Committee.