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GA Blog: Flood Insurance

Showing blogs: 16 of 6

10.9.19 Another Band-aid Applied to NFIP

On September 30th the National Flood Insurance Program (NFIP) was again extended to avoid a lapse in coverage.  This extension runs through November 21st, where the program will need to be extended for the 14the time in 2 years or reauthorized.

The National Association of REALTORS® continues to urge Congress to pass the NFIP Reauthorization Act which would extend the program 5 years and contribute significant reforms such as improved mapping and removal of obstacles to private flood insurance.

NAR estimates that if the program were to lapse approximately 40,000 home sales would be affected every month.

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9.10.19 Flood Insurance Is Up Again for Renewal

The National Flood Insurance Program (NFIP) is again set to expire.  The current extension, the 11th of its kind in the last 2 years, expires on Monday, September 30th at midnight.

On July 11th the House Financial Services Committee unanimously passed a 5-year reform and reauthorization legislation but the House of Representatives has not scheduled a vote.  The Senate has introduced several bills but has taken no further action. Flood insurance was a priority talking point for NAR when Federal Political Coordinators met with members of Congress over the August break.

Locally, any lapse in NFIP can mean delays for home sales that are relying on the program for mortgage approval.  If there was to be a lapse, NFIP cannot sell new flood insurance policies.  The federal requirement to purchase flood insurance is also suspended.  This leaves lenders to ultimately decide if they will make the loan at all when NFIP insurance is not available.

NAR has estimated that nationwide a lapse might impact around 40,000 home sale closings per month.

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6.14.19 House Financial Services Committee advances the National Flood Insurance Program Re-authorization Act of 2019

The House Financial Services Committee voted on June 12th to advance the National Flood Insurance Program Reauthorization Act of 2019. Introduced by Chairwoman Maxine Waters and Ranking Member Patrick McHenry, H.R. 3167 reauthorizes the NFIP for 5 years, increases the program's mitigation tools and updates its mapping scope and technology, among other reforms. John Smaby, President of the National Association of REALTORS®, issued the following statement:

“NAR is pleased to see the House Financial Services Committee take a critical first step in the process toward long-term National Flood Insurance Program reform and reauthorization,” Smaby, a second generation REALTOR® and broker at Edina Realty in Edina, Minnesota, said. “We thank Chairwoman Waters and Ranking Member McHenry for considering various NAR priorities within this legislation, including policies that address mapping, mitigation and private flood insurance, and we look forward to working with them to move responsible NFIP reforms through the House and Senate in the coming weeks.”

The House Financial Services Committee voted unanimously on Wednesday to move H.R. 3167 to the House floor, with a vote expected in the coming weeks. The NFIP has been extended through a dozen separate short term extensions over the past two years, with two brief lapses occurring over that time. The program retains authority to issue flood insurance through September 30, 2019.

 


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6.4.19 NFIP Extended to September 30th

Late on Monday, June 3rd, the House passed a disaster aid bill (H.R. 2157) that extends the National Flood Insurance Program through September 30th. It now heads to President Donald Trump, who is expected it sign it.

The legislation, which the House passed in a 354-58 vote, averts a lapse in the program on June 14th. Trump signed a stopgap, two-week extension this past Friday after some House members objected to expedited passage of the disaster bill.

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5.31.19 NFIP Extended Until June 14th

On Thursday, May 30th, Congress unanimously voted to renew the National Flood Insurance Program until June 14th, after the Senate approved the reauthorization last week. This will allow the NFIP to continue issuing insurance at the beginning of the hurricane season.

If the program eventually expires, NFIP will no longer be authorized to renew or sell flood insurance policies. Additionally, it will be unable to acquire new funding and once its existing funding is spent, NFIP will not be allowed to borrow more. In areas at risk for floods, it will be up to lenders whether or not to issue loans to potentially affected homebuyers, as the requirement to purchase flood insurance will no longer be in effect.

NAR continues to work to support the extension of NFIP through grassroots organizing and lobbying activities. During hill visits two weeks ago, flood insurance was a major talking point for REALTORS® speaking with their legislators. With many areas of the North Shore at risk for flooding, updates to the NFIP’s mandate continue to be important for homeowners and prospective buyers in the region.

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4.30.19 FEMA Unveils ‘Risk Rating 2.0’

FEMA announced changes to the way the National Flood Insurance Program (NFIP) will charge homeowners for flood risks. The change—dubbed “Risk Rating 2.0”—could have a significant impact on flood insurance bills for millions of homeowners.

Risk Rating 2.0 aims to  improve the policyholder experience by leveraging industry best practices and current technology to deliver rates that are transparent and better reflect a property’s unique flood risk.

The new risk rating system will fundamentally change the way FEMA rates a property’s flood risk and prices insurance. With Risk Rating 2.0, FEMA is pairing state-of-the-art industry technology with the NFIP’s mapping data to establish a more comprehensive understanding of risk at both the community and individual level.

Risk Rating 2.0 will help customers better understand their flood risk and provide them with more accurate rates based on their unique risk. This will include determining a customer’s flood risk by incorporating multiple, logical rating characteristics–like different types of flood, the distance a building is from the coast or another flooding source, or the cost to rebuild a home. The new rating plan will also aim to ensure customers will no longer face dramatic rate increases during map changes or at the edge of flood zones. Risk Rating 2.0 will comply with existing statutory caps on premium increases to help transition policyholders who may face otherwise substantial rate increases.

Read more from FEMA about Risk Rating 2.0 on the official announcement.

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