REALTORS® Support Measure to Delay Flood Insurance Premium Increases – Respond to Call for Action
Late last month, federal lawmakers introduced legislation on Capitol Hill to help stem the tide of financial hurt being inflicted on property owners from sharply higher flood insurance premiums. The rate increases are the result of the recent redrawing of flood plain maps by the Federal Emergency Management Agency (FEMA), along with implementation of new National Flood Insurance Program (NFIP) rules authorized under the Biggert-Waters Flood Insurance Reform Act of 2012 (BW12).
The bi-partisan bills (S. 1846 and H.R. 3370) each propose a four-year delay in further implementation of the new flood insurance rate structure until FEMA completes an affordability study required under BW12. The measures apply strictly to owners of grandfathered properties and those purchased after July 2012 (when BW12 took effect), including second homes and commercial properties. If passed, the result of these bills would be to effectively postpone any rate changes until 2016 or later for qualifying home and business owners, while others would see any rate increases capped at 20-25 percent per year. The legislation, aka the Homeowner Flood Insurance Affordability Act, also proposes creation of a Flood Insurance Advocate within FEMA to investigate and assist property owners with verifying the accuracy of flood insurance rate quotes and regulatory action to address cost concerns identified by the study.
While the National Association of REALTORS® supported the five-year re-authorization of the NFIP under BW12, NAR is now urging passage of the newly-introduced Homeowner Flood Insurance Affordability Act to protect property owners from excessive rate hikes, help sustain home sales in affected markets, and ensure the viability of the flood insurance program. All members are urged to participate in NAR's Call-for-Action in support of this legislation and may do so through the REALTOR® Action Center. To read more about recent REALTOR® efforts to voice the real estate industry’s concerns to regulators and state and federal lawmakers about the impact revisions to the NFIP are having on property owners, the housing market, and future affordability of flood insurance see the previous story in the October 24 issue of the GBAR Informer.