April 23, 2018

House Passes Bill to Halt Flood Insurance Hikes

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House Passes Bill to Halt Flood Insurance Hikes

The House overwhelmingly approved bipartisan legislation on Tuesday that could help curtail the increases in flood insurance rates that home owners are facing across the country. The Homeowner Flood Insurance Affordability Act, H.R. 3370, now goes before the Senate.

The National Association of REALTORS® applauded the House’s move, saying the bill will help protect home owners from the “drastic premium increases” that took effect on Oct. 1.

The 2012 Biggert-Waters law set out to gradually phase out flood insurance subsidies to make up for the National Flood Insurance Program's $24 billion debt. Therefore, home owners who have long received federal aid to pay for flood insurance were facing, in some cases, up to tens of thousands of dollars a year extra in flood insurance hikes.

“Home owners nationwide, on the coasts and also inland, who are experiencing financial hardship because of extreme and sudden premium increases will feel immediate relief from this bill, which ensures a slow and steady phase-in of risk-based increases,” NAR President Steve Brown said in a statement. “Most importantly, the bill removes [the Federal Emergency Management Agency’s] authority to increase premium rates to unjustified levels at the time of a property’s sale, which will stabilize local real estate markets and ensure that both property owners and prospective buyers are treated equally.”

NAR has estimated that about 40,000 home sales have been delayed or canceled as of January 2014 due to confusion over flood insurance rates.

—By REALTOR® Magazine

Read more:

Everything You Need to Know About the National Flood Insurance Program
Brown: Flood Insurance Hikes Drowning Home Owners