Bipartisan Bill Protects Flood Insurance Policyholders
Representatives Carolyn B. Maloney (D, NY-12) and Lee Zeldin (R, NY-1) members of the House Financial Services Committee, announced on June 15 that their bipartisan bill, the NFIP Policyholder Protection Act (H.R. 2868), which was introduced earlier this week, passed through the Financial Services Committee as part of Congress’ overall effort to reauthorize and reform the National Flood Insurance Program (NFIP).
The NFIP Policyholder Protection Act would result in a credit to homeowners with NFIP policies who invest in mitigation activities, such as elevating their homes, adding porous foundations, or moving boilers to a higher floor, which would result in lower premiums and help reduce the cost to homeowners. Among other provisions, the bill also requires FEMA to better cover co-op units within NFIP.
Congresswoman Maloney said, “The flood insurance program covers all types of communities — from small rural towns, to dense urban areas like New York City, which I’m privileged to represent. The differences between these types of communities are perhaps most important when it comes to mitigation under the flood insurance program. Some mitigation options that are available in smaller communities — such as elevating the house — are simply not an option in New York; you can’t elevate a 50- story apartment building. But that doesn’t mean that there are no mitigation options for New York. This bill recognizes these different circumstances in cities like New York, and would explicitly allow policyholders to receive credit for mitigation techniques that can be deployed on a block or neighborhood scale, ideal for dense urban cities like New York. The bill would also allow policyholders to receive mitigation credit for the elevation of mechanical systems — such as boilers — which, when they’re not elevated, can be a huge source of losses for FEMA as we saw in the aftermath of Hurricane Sandy. This is especially important because effective mitigation of flood risks helps both policyholders and taxpayers. It helps policyholders because they can receive lower premiums when they’ve reduced their flood risk through effective mitigation techniques, and it helps taxpayers because it reduces the risk that FEMA will have to pay out large claims when there’s a flood. I’m proud to have worked with Rep. Zeldin on this bill.”
Congressman Zeldin said, “I am proud to announce that my bipartisan bill to protect homeowners on Long Island and across our state and country has passed through committee. The National Flood Insurance Program (NFIP), which so many homeowners rely on, currently has a debt of $24.6 billion and must be reformed so that the program will continue to provide homeowners with access to affordable insurance. In (District) NY-1, which is almost completely surrounded by water, we saw firsthand during Super Storm Sandy just how many homeowners rely upon NFIP to protect their property. I’ve heard time and again from homeowners in my district who are frustrated with the process. More can and must be done to protect homeowners’ access to affordable insurance, and improve the way claims are processed so that policyholders aren’t stuck dealing with bureaucracy and red tape after their property is damaged by a flood. We also must shift the focus toward mitigation so that there is an incentive for homeowners and communities to take proactive steps to protect against flood damage. Despite homeowners doing the right thing and elevating or renovating their homes to protect their property, many have not seen a return on their investment in the form of lower NFIP premiums. The NFIP Policyholder Protection Act would ensure that preparedness is a critical focus to protect life and property. Passage of this legislation is very important for homeowners on Long Island and across the country. I'm very grateful for the strong leadership and bipartisan support of Congresswoman Carolyn Maloney, Chairman Jeb Hensarling and Chairman Sean Duffy and I look forward to working with all of my colleagues in Congress to get this bill on the House floor and passed.”
New York City’s Chief Resilience Officer Dan Zarrilli said, “New York City is pleased to see proposed legislation that emphasizes feasible mitigation options for the types of buildings that are built in dense urban environments. These mitigation options will enable homeowners and businesses to reduce their flood risk in an affordable way, which is necessary to enhance resiliency in cities across the nation."
The NFIP Policyholder Protection Act has received strong bipartisan support from elected officials in New York. The legislation is also supported by 16 organizations, including the National Multifamily Housing Council (NMHC), National Wildlife Federation, and the American Consumer Institute.