Senate Passes Flood Insurance Legislation

Filed in Capitol Hill, Home Building by on March 14, 2014 0 Comments
Facebooktwitterlinkedinmail

NAHB applauds the Senate for yesterday approving flood insurance legislation that will provide much-needed certainty to home owners and financial stability for the National Flood Insurance Program (NFIP). H.R. 3370, the Homeowner Flood Insurance Affordability Act, was approved by the House earlier this month and is expected to be signed into law shortly by President Obama.

“By providing a more affordable rate structure for policyholders and repealing point-of-sale rate increases, the bill is a boon for home owners and home buyers,” said NAHB Chairman Kevin Kelly, a home builder and developer from Wilmington, Del. “Further, it gives an important boost to home building and remodeling, while simultaneously shoring up the NFIP.”

H.R. 3370 will help address some of the costly and unintended consequences of the Biggert-Waters Flood Insurance Reform Act, including huge premium spikes and impacts on the sale, construction and remodeling of homes across the nation.

The legislation provides a more affordable rate structure for policyholders; repeals the requirement that flood insurance premiums increase immediately to full actuarial rates for homes that are sold; and restores “grandfathering” for properties that were paying premiums applicable to their initial flood risk rating, allowing owners to pay premiums based on the original risk zone rather than updated flood risk zones.

The bill also requires the Federal Emergency Management Agency’s remapping process to take into account local flood control structures and provides reimbursement for successful consumer map appeals.

Further, it restores the “substantial improvement threshold” that triggers a higher flood insurance rate to the historic 50% level of a structure’s fair market value, which is important for many remodelers across the nation.

NAHB estimates that the new flood insurance law will result in:

  • $755 million more in new home construction annually because it is now easier for potential new home buyers to sell their existing home and trade up.
  • $361 million a year in additional remodeling activity because there is no longer added insurance expense for certain remodeling jobs.

Tags:

Leave a Reply

Your email address will not be published. Required fields are marked *