Senate passes bill to delay increases to flood insurance premiums

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MAYS LANDING – The U.S. Senate Thursday, Jan. 30 approved a bill 67-32 that would delay increases to premiums under the National Flood Insurance Program for four years.

The bill, authored by New Jersey Sen. Robert Menendez, is a modeled after bipartisan House legislation authored by Reps. Michael Grimm of New York, Maxine Waters of California, Cedric Richmond of Louisiana and Frank LoBiondo of New Jersey.

Menendez’s bill, the Menendez-Isakson Homeowner Flood Insurance Affordability Act, will freeze flood insurance premium increases on most properties impacted by Biggert-Waters until FEMA completes an affordability study, provides solutions to mitigate their effect and scientifically certifies their accuracy.

“This is a triumphant victory for the thousands of New Jersey homeowners who need our help and stood up, spoke out and stuck with me until we took this flood insurance relief bill over the finish line,” Menendez said. “At a time when ordinary families are frustrated because government doesn’t seem to listen, I heard you loud and clear and thankfully both sides of the aisle came together to fix this problem so middle class families can afford flood insurance and stay in their homes, businesses can stay open, and property values won’t plummet. This fight isn’t just about insurance rate tables and actuarial risk rates; it’s all about hardworking people. People who played by the rules their whole lives and are now facing a life-altering event they never could have prepared or planned for. 

“But our fight is not over,” he said. “Now we must call on Speaker (John) Boehner and the House to pass this legislation so we can send it to the president to sign it into law.”

After the vote, LoBiondo called upon House Speaker John Boehner of Ohio to immediately put flood insurance legislation on the House calendar for a vote.

“More than a year after Sandy, there remains a host of issues hindering South Jersey residents as they rebuild their homes, their businesses and their lives. Where it is possible to ease any further negative impact, I’m willing and determined to do so. I applaud the Senate’s strong bipartisan stance in support of delaying planned increases to many flood insurance premiums. I applaud Sen. Menendez for taking a lead on this critical issue and appreciate Sen. Booker’s support of our efforts. I urge my colleagues in the House to follow their lead,” LoBiondo said.

The increases to flood insurance premiums are mandated by the June 2012 Biggert-Waters Flood Insurance Reform law, which aims to reduce government subsidies for participants in the National Flood Insurance Program.

A wave of insurance claims after Hurricane Katrina put the National Flood Insurance Program on the verge of bankruptcy.

The reform would phase in premium increases for NFIP participants whose homes were built prior to the initiation of the NFIP (also called pre-FIRM) and which have previously flooded or are non-primary residences in high risk areas.

Under the law, any newly issued policy for a pre-FIRM home will reflect no subsidy. In addition, pre-FIRM primary residences receiving subsidized rates will continue to do so unless the property is substantially improved, incurs repetitive loss, is sold or the policy is allowed to lapse.

“There is a finite window of opportunity to help millions of households from the crushing financial burden on the horizon. There is bipartisan agreement on the scope and depth of this problem. There is also a bipartisan solution readily available and approved by the Senate. It is imperative we take action and inexcusable if additional vote delays occur,” LoBiondo said.

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