President Barack Obama has signed the “Biggert-Waters Flood Insurance Reform and Modernization Act of 2012” into law. The law extends the National Flood Insurance Program (NFIP) for five years and makes reforms to the program.
The Senate and House passed the legislation on June 29 as part of a conference report package along with the Surface Transportation Act of 2012 and an extension of the Federal Direct Stafford Student Loan program.
The Independent Insurance Agents & Brokers of America (IIABA or the Big “I”) praised the signing.
“The Big ‘I’ commends President Obama and Congress for working together, and in a bipartisan fashion, to protect millions of homeowners and businesses across the country who are threatened by flooding,” said Robert Rusbuldt, Big “I” president and CEO. “The Big ‘I’ looks forward to the implementation of the many provisions that will help put the program on more solid financial footing.”
The legislation that will extend the NFIP for five years, until Sept. 30, 2017, It also calls for reforms including phasing out subsidies for many properties, raising the cap on annual premium increases from 10 percent to 20 percent, allowing multifamily properties to purchase NFIP policies, imposing minimum deductibles for flood claims, requiring the NFIP administrator to develop a plan for repaying the debt incurred from Hurricane Katrina, and establishing a technical mapping advisory council to deal with map modernization issues.
The new law will also require the Government Accountability Office (GAO) to conduct a study on the prospect of adding business interruption and additional living expenses coverages to the NFIP and would require the Federal Insurance Office (FIO) to study and submit a report to Congress on natural disaster insurance issues and possible legislative solutions.
“This legislation has been a top priority of the Big ‘I’ for the last several years, and we are very proud today that this balanced, bipartisan bill that will protect both consumers and taxpayers has finally been signed into law,” said Charles Symington, Big “I” senior vice president of government affairs.
Symington cited several legislators for their work on the measure including Senators Spencer Bachus (R-Ala.), Tim Johnson (D-S.D.), Jon Tester (D-Mont.), Richard Shelby (R-Ala.) and David Vitter (R-La.) and Representatives Barney Frank (D-Mass.), Judy Biggert (R-Ill.) and Maxine Waters (D-Calif.).
Article published in the Insurance Journal on July 9, 2012.
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