It’s not often a bill gets bipartisan support these days. However, H.R. 2901, the Flood Insurance Market Parity and Modernization Act of 2015, was passed unanimously when it came up for vote this week.
A bill amends current flood program law to allow and encourage the private insurance sector to enter the flood insurance market. Revisions include an easing of flood insurance requirements that apply to home loans or loan guarantees by Fannie Mae and Freddie Mac. Mandatory insurance limits still apply –the amount being equal to: the development or project cost minus estimated land cost; the outstanding principal balance of the loan, or; the maximum limit of federal coverage available for the type of property, whichever is less.
H.R. 2901 also clarifies that a move from the NFIP to private flood insurance that meets state requirements would be considered continuous coverage. Plus, the bill gives state insurance regulators control to develop guidelines for policies that qualify.
For the National Flood Insurance Program, which is over $20 billion in debt, the timing is excellent. By allowing for the transfer of some of the NFIP’s $1.1 trillion in exposure, the program itself can alleviate some of its financial pains.
The bill now moves on to the Senate. For updates on the bill, visit Congress.gov.