Washington, DC – October 31, 2013 – (RealEstateRama) — U.S. Rep. Nick J. Rahall is introducing legislation today that would suspend the flood insurance rate increases that millions of homeowners are now subject to. At the beginning of the month, participants in the National Flood Insurance Program saw dramatic increases their premiums as a result of Biggert-Waters Flood Insurance Reform Act of 2012. However, the law took effect while Flood Insurance Rate Maps (FIRMs), which are used to determine flood insurance rates, are in the process of being updated nationwide. Rahall’s bill, HR 3380 would freeze the insurance hikes until the updated maps are finalized and would reimburse homeowners that are paying higher premiums in the interim.
“It’s not just rising waters that homeowners in flood prone areas now have to worry about, but dramatically rising flood insurance rates that are depressing home values and potentially forcing residents from the communities they lived in for generations,” Rahall said. “If being socked with skyrocketing premiums wasn’t bad enough, the maps that FEMA is relying on to justify these rate increases have not even been finalized. In some instances the new maps don’t even reflect federally funded flood projects that would take certain communities out of flood prone zones. My bill would suspend the new rate changes until these maps have been appropriately updated and would reimburse those that are now paying these unfair higher premiums.”
Since 1962, the National Flood Insurance Program has helped homeowners purchase affordable flood insurance. Changes to the Program designed to relieve its $24 billion deficit, mandated by the Biggert-Waters, have unexpectedly resulted in higher premiums for millions of homeowners across the country. Concerns have also been raised that as new flood maps are being draw across the country, they have neglected to include flood control efforts that would result in lower flood risk designations for certain communities. As such, Rahall’s legislation would also require the Army Corps of Engineers to certify that these maps include all flood control and mitigation projects before insurance rates could change.
According to Rahall: “These drastic premium increases were not intended by Congress and as such homeowners should not be forced to pay them. My bill would put the brakes on these hikes, make flood insurance participants whole, and gives Congress an opportunity to find a reasonable solution that shores-up the flood insurance program without increasing premiums to unreasonably high levels.”