Congress cuts increases in flood insurance premiums
Washington – The U.S. House of Representatives voted late Tuesday on a bill that would give thousands of Connecticut homeowners relief from rising federal flood insurance premiums.
Under the House bill, supported by every member of Connecticut’s congressional delegation, premiums under the National Flood Insurance Program (NFIP) could increase no more than 18 percent per property annually.
Rep. Michael Grimm, R-N.Y., introduced the bill because some New York homeowners saw their premiums increase tenfold.
“Over the last six months, I have spoken to eastern Connecticut Realtors and home builders about the critical need for this law,” said Rep. Joe Courtney, D-2nd District. “The skyrocketing rate increases that have occurred in the last year will effectively lock up our state’s real estate market in flood zones, hampering our economic recovery.”
The flood insurance bill unravels legislation, called the Biggert-Waters Act, approved by Congress just two years ago that aimed to put the federal flood insurance program on firmer financial footing by scaling back subsidies. The federal government subsidizes up to 60 percent of the cost of flood insurance premiums. The flood insurance program, managed by the Federal Emergency Management Agency (FEMA), was hard hit by Hurricane Katrina claims and went further into the red after Hurricane Sandy, which led to nearly $10 billion in claims. The program is $24 billion in debt.
But Connecticut lawmakers argued the reforms aimed at making the program solvent went too far.
“Congress never intended to impose the punitive and unaffordable flood insurance premiums FEMA is imposing on some homeowners,” said Rep. Rosa DeLauro, D-3rd District. “I have heard from constituents who were expecting to pay rates as much as 5,000 percent higher than they were paying. This bill would provide relief from such flood insurance premium ‘shock’ that is hurting homeowners and depressing home values.”
A bill approved by the Senate last month would roll back the Biggert-Waters Act even further.
The Senate-approved legislation would delay all premium increases for up to four years until new flood maps are reviewed for accuracy, and FEMA conducts an affordability study on the new premiums.
The Senate is expected to accept the House bill and could vote on it later this week.
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