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House Passes 5-Year Extension of NFIP, PIA Applauds Action

On Thursday July 15, the House of Representatives passed the Flood Insurance Reform and Priorities Act of 2010 (H.R. 5114). The bill, approved by a...
July 21, 2010

On Thursday July 15, the House of Representatives passed the Flood Insurance Reform and Priorities Act of 2010 (H.R. 5114). The bill, approved by a vote of 320-90, makes key reforms to the National Flood Insurance Program (NFIP) and extends the program's authorization through the end of 2015. PIA supported H.R. 5114, urging the House to pass the bill and offering praise when it did.

"The overwhelming margin of approval demonstrates that there is very broad support for the National Flood Insurance Program (NFIP) and for common-sense reforms to make it better," said PIA Executive Vice President & CEO Leonard C. Brevik. "The five year reauthorization included in the bill will provide the certainty needed to ensure that the flood insurance program continues to provide affordable protection to homeowners and business owners without needless interruptions. We urge the Senate to follow suit and approve H.R. 5114, with some improvements."

Among the reforms to the flood insurance program made by the bill include the phasing out of subsidized premiums for severe repetitive loss properties, substantially damaged or improved properties and policyholders who voluntarily allow flood coverage to lapse. In addition, mitigation programs are strengthened by clarifying that the director of FEMA may work with property owners to make mitigation grants for certain repetitive loss properties where states or communities are either unable or unwilling to address repetitive loss issues with a property owner.

Rep. Taylor's Amendments

An amendment included in the bill requires NFIP Write Your Own (WYO) insurers to agree that they will not use "anti-concurrent causation" language to exclude coverage of wind damage because there is also flood damage to a property. The amendment was offered by Rep. Gene Taylor (D-Miss.). PIA has urged that when the Senate considers H.R. 5114, this amendment should be removed.

Another amendment by Rep. Taylor which would add wind coverage to the NFIP was ruled not germane to H.R. 5114 by the House parliamentarian, because the bill is about flood insurance, not wind insurance. Later this week, Rep. Taylor's Multiple Peril Insurance Act of 2009 (H.R. 1264) will be debated on the House floor. It would amend the National Flood Insurance Act of 1968 to require the NFIP to enable the purchase of multiperil coverage and optional separate windstorm coverage. PIA opposes H.R. 1264 (see next item).

During the run-up to the House vote on H.R. 5114, PIA National sent a letter to House Speaker Nancy Pelosi (D-Calif.) and Minority Leader John Boehner (R-Ohio) urging that it be passed without delay. PIA's letter and press releases prompted articles and quotes in news coverage of the issue by the major industry trade publications (see below).

Agents Applaud House Passage of Flood Bill (Insurance Journal 7/16/10) (PIA quotes)
Flood Legislation Fireworks (National Underwriter 7/16/10) (PIA quotes)

Groups Fight Wind Amendment (National Underwriter 7/15/10) (PIA quotes)

PIA Letter Urges House Passage Of 5-Year NFIP Extension (National Underwriter 7/13/10)

PIA Urges House to 'Quickly Pass' Flood Bill (Ins. & Financial Advisor 7/13/10)

PIA National Letter to Speaker Pelosi, Minority Leader Boehner (7/13/10)

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