NAR says significant improvements to the “21st Century Flood Reform Act” have cleared the way for endorsement of the bill.
In a welcome press release the National Association of REALTORS® touted changes to the 21st Century Flood Reform Act which includes a commitment to retaining "grandfathering" - a policy that protects homeowners from significant rate increase when a flood map changes. This key provision had been left out of the initial draft of the bill. The new bill limits increases to fees and limits rate increases which earlier versions of the bill had included.
This legislation protects taxpayers, as well as homeowners, which is no easy task. The September 30 reauthorization deadline still looms in front of us, and Realtors® are eager to see this legislation progress quickly. Leaders on both sides of the aisle are well aware that this issue touches 22,000 communities – in every state, both coastal and inland.
-- NAR President William E. Brown
The bill expects to achieve reforms to improve the financial stability of the National Flood Insurance Program, to enhance the development of more accurate estimates of flood risk through new technology and better maps, to increase the role of private markets in the management of flood insurance risks, and to provide for alternative methods to insure against flood peril, and for other purposes.
In February NAR put out their brief on The National Flood Insurance Program, which reads as follows;
NAR Principles for Flood Insurance Reform
(February 17, 2017)
The National Flood Insurance Program (NFIP) was essential to completing nearly a half million home sales in 2015, according to NAR research. However, the program as currently structured is unsustainable for policyholders and taxpayers alike. For these reasons, NAR supports a strengthened NFIP coupled with a robust private market to offer choices and maintain access to flood insurance in all markets at all times. NAR believes:
- NFIP reauthorization should be long term.
- To keep rates affordable, the federal government should provide pre-disaster risk mitigation options – including guaranteed loans, grants and buyouts for property owners to build stronger or relocate to higher ground.
- Private flood insurance options should also be encouraged where cost effective, provided that NFIP remains a viable option for property owners.
- Premiums should be more accurately priced to the property specific risk, but any rate increases should be gradual and phased in over many years.
- There should be better oversight and training of insurance companies marketing NFIP policies, and an adequately supported Homeowner’s Advocate at NFIP to directly assist policy holders with rate disputes.
- Flood mapping should be done at higher resolutions with a streamlined and less expensive appeal process.
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