On March 21, 2014, President Obama signed the Homeowner Flood Insurance Affordability Act of 2014 into law. This law repeals and amends certain provisions of the Biggert-Waters Flood Insurance Reform Act of 2012 (Biggert-Waters) and the National Flood Insurance Act of 1968.
The Federal Emergency Management Agency’s (FEMA) National Flood Insurance Program (NFIP) has provided a bulletin to its private sector, Write Your Own insurance company partners on the additional steps underway to implement changes to the program and provide premium relief to qualifying policyholders who received rate increases under Biggert-Waters.
Specifically, the bulletin provides new rate tables to Write Your Own insurance companies that comply with the increase in premium caps required under Section 5 of the Homeowner Flood Insurance Affordability Act. Section 5 prohibits FEMA from increasing premiums more than 15 percent a year within a single risk class and not more than 18 percent for an individual policy, with some exceptions.
These new rates apply to policies purchased or renewed on or after October 1, 2014. Polices written or renewed prior to the effective date of these new October 1, 2014, rates will continue to use the previous October 1, 2013 rates.
This new rate guidance will be used to calculate refunds for qualifying policyholders. In the coming weeks, FEMA will issue additional guidance to our Write Your Own insurance partners on the developed business practice that will identify who is entitled to a refund, how the refund will be calculated and when the refunds will be issued. Eligible policyholders should begin receiving premium refunds as soon as late Fall 2014.
FEMA will continue to work with Congress, Write Your Own insurance companies, other industry partners and stakeholders, and NFIP Policyholders to implement the changes to the NFIP program with the shared goal of helping families maintain affordable flood insurance, ensuring the financial stability of the program, and reducing the risks and consequences of flooding nationwide.
If you have any questions, please feel free to contact FEMA’s Intergovernmental Affairs Division at (202) 646-3444 or at FEMA-IGA@fema.dhs.gov.
Facebook
Twitter
YouTube
RSS