U.S. House to Vote on Flawed Private Flood Insurance Legislation

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Statement by Rachel Cleetus, lead economist and climate policy manager, Union of Concerned Scientists.

WASHINGTON (September 27, 2017)—The U.S. House of Representatives is expected to vote tomorrow on legislation to reauthorize funding for the Federal Aviation Administration for six months and provide tax relief for those affected by the recent hurricanes. Included in this bill are a number of concerning provisions on unrelated matters, including flawed language to expand private flood insurance without ensuring it meets important criteria. This language could undermine the National Flood Insurance Program, which millions of Americans depend on for insurance against flooding costs.

Below is a statement by Rachel Cleetus, lead economist and climate policy manager at the Union of Concerned Scientists.

“The House bill falls well short of the comprehensive reforms needed to ensure a robust National Flood Insurance Program that can better protect people and property. Though other provisions of the overall bill are crucial, the House is trying to push through controversial language which does nothing to put the program on firmer financial footing and may actually end up hurting consumers.

 “Of course, private flood insurance can and should play an important role alongside the federal program, but only if it meets at least the same standards as the federal policies. The bill doesn’t mandate that private policies provide coverage at least as broad as that provided by the federal flood insurance program, which could leave consumers at risk of buying policies without essential protections.

“Also concerning is that private policies under this bill are not required to include a fee to contribute to updated flood risk mapping. Yet, private insurers will continue to take advantage of this vital and already under-resourced part of the National Flood Insurance Program.

“Finally, this attempt to expand the private insurance market does not provide crucial incentives for community-wide floodplain management, which is a key element of the federal program that helps protect communities and keep flood losses down.

“Congress has a duty to provide comprehensive, thoughtful reforms to the National Flood Insurance Program before its current reauthorization runs out on December 8th, not to mention the likely need to raise its borrowing cap well before that to pay for hurricane-related claims. Measures to promote private flood insurance should be considered as part of this reauthorization.

“Comprehensive reforms should include: updated flood risk maps to reflect the latest science, more incentives for homeowners and communities to invest in lowering their flood risks, steps for phasing in risk-based insurance rates and broadening the insurance base, addressing affordability concerns for low-income homeowners, and more well-considered provisions for private flood insurance.

“I urge members of Congress to work together expeditiously on a more comprehensive package of reforms and not take this piecemeal approach that attempts to fast-track an ill-considered version of private flood insurance.”

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