U.S. Rep. Gus Bilirakis announced today sponsorship of the Homeowners Flood Insurance Relief Act, a new House bill that would curb the rising tide of federal flood insurance rates.
The North Pinellas Republican introduced HR 3312 to address problems with the reworked National Flood Insurance Program (NFIP) premiums and ensure the NFIP remains sustainable for taxpayers and affordable for homeowners. The bill caps premiums to no more than the appraised value of the home over the course of a 30-year mortgage.
Rate increases would be phased-in over 10 years, and allows homeowners to pay monthly premiums than a once-a –year sum.
“Homeowners across the country are currently facing significant rate increases as a result of reforms made to address the solvency of the NFIP,” Bilirakis said in a statement. “This legislation is a backstop for catastrophic rate increases that have not only created significant hardship for hardworking Americans, but also have the potential to limit or freeze home sales that would help in the recovery of our already fragile housing market.”
Annual rates for properties in low-lying areas, especially in coastal areas, skyrocketed anywhere from double to tenfold this year, depending on elevation levels on reconfigured FEMA flood maps.
In Florida, some flood insurance premium are reported to have jumped to more than $20,000 per year.
Bilirakis’ bill enacts some commonsense changes to the Homeowners Flood Insurance Relief Act while ensuring homeowners continue to protect property through the program, while minimizing effects of increased premiums on recently recovering housing markets.
Hurricanes Sandy and Katrina forced the NFIP to owe $24 billion to taxpayers. The Biggert-Waters Reform Act of 2012 attempted to reform NFIP premiums, linking them with cost of coverage. As a result, rates rose sharply, and the reforms actually became counterproductive.