The National Association of REALTORS® (NAR) is applauding the House of Representatives for passing what NAR believes is smart, much-needed support for the National Flood Insurance Program (NFIP).
“REALTORS® know firsthand what happens when the NFIP expires, and it isn’t good for consumers, businesses or our communities,” says NAR President Elizabeth Mendenhall. “We appreciate the leadership that members of Congress have shown passing sound reforms, which will strengthen the program, protect property owners and deliver good results for taxpayers.”
The NFIP is responsible for providing the vast majority of flood insurance policies in over 20,000 communities nationwide. Without it, most consumers would be unable to purchase the flood insurance that’s required on mortgages in a flood plain. In the past, NAR has shown that 40,000 home sales are lost every month when the program is unavailable.
H.R. 2874, the “21st Century Flood Reform Act,” reauthorizes the NFIP for five years, while taking steps to reform the program. These reforms include:
- Authorizing $1 billion to elevate, buy out or mitigate high-risk properties
- Capping flood insurance premiums at $10,000 per year for homeowners
- Removing hurdles to the private flood insurance market, which often offers better coverage at lower cost than the NFIP
- Providing for community flood maps and a homeowner’s ability to appeal their flood designation
- Better aligning NFIP rates to match a property’s true risk, particularly for in-land and lower-value properties
- Improving the claims process for flood victims
- Addressing repeatedly flooded properties, which account for 2 percent of NFIP policies but 25 percent of claim payments
These changes, Mendenhall says, would improve the NFIP’s financial health, put consumers on a stronger footing, and deliver certainty to current and prospective homeowners.
“The conversation happening in Washington on this issue is fundamentally about how we deliver the best results for consumers and taxpayers, and that’s a good conversation to have,” says Mendenhall. “REALTORS® are simply asking that Congress swiftly deliver on the promise of this program so buyers can move forward without interruption and homeowners know their most important asset is protected. With December 8 around the corner, we’re hopeful the Senate will now step up to the plate and do their part by passing a flood reform and reauthorization package without delay.”
For more information, please visit www.nar.realtor.
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