The Senate voted 67-32 yesterday to delay scheduled flood insurance rate hikes under the 2012 Biggert-Waters law. The ABA and ABIA-supported bill, S. 1926, will delay the scheduled rate increases until FEMA completes its mandated affordability study and certifies that it has fully updated its flood maps.
The bill, introduced by Sen. Robert Menendez (D-N.J.), would exempt currently grandfathered properties, as well as those sold or for which new policies were purchased after July 6, 2012. Within two years FEMA must complete its study, for which the Senate bill provides the necessary funding.
“This legislation is a key priority for many of our members and -- even more importantly -- for homeowners across the nation,” said ABA President and CEO Frank Keating. “The strong vote from the Senate today shows the importance of addressing the unintended consequences of reforming the flood insurance program.”
The scheduled rate increases are intended to bring flood insurance premiums up to actuarially sound levels and put the program on a firm financial footing. While supporting the move to actuarial rates, ABA has expressed concern that precipitous rate increases could hurt homeowners and the housing market.
An ABIA-supported amendment that would have strengthened the private flood insurance market was narrowly defeated. Meanwhile, Sen. Jeff Merkley (D-Ore.) withdrew an ABIA-opposed amendment that would have negatively affected the regulatory environment for lender-placed insurance.
Read Keating’s statement.