Thursday, 29 March 2007
Bill To Expand National Flood Insurance
A bipartisan group of legislators in the U.S. House of Representatives designed a bill to expand and improve the National Flood Insurance Program (NFIP), which provides affordable insurance coverage for Americans living in flood risk areas.
The bill would raise the NFIP’s funding by almost $1 billion, and would increase the maximum coverage payouts for insurance claims. It also aims to address many of the NFIP’s current weaknesses.
Currently, the NFIP provides $250,000 in coverage for a home’s structure, $100,000 for the home’s contents, and $500,000 for commercial buildings. The new legislation bumps up coverage maximums to $335,000, $135,000, and $670,000, respectively.
The maximum payout increase is meant to update NFIP coverage to today’s market prices.
The legislation will also increase fines for lenders not enforcing federally mandatory flood insurance regulations. All homeowners who live in floodplains or have federal mortgages are required to have flood insurance.
“Congress must act now to modernize this important safety net for homeowners,” said Republican Representative Judy Biggert of Illinois, the ranking member of the House Financial Services Subcommittee on Housing and Community Opportunity.
“The 2005 Gulf Coast hurricanes showed the nation how important the National Flood Insurance Program is to the average homeowner… The program needs to provide a financial safeguard for homeowners while protecting the interests of taxpayers,” Biggert added.
The bill is co-sponsored by Democratic Representative Barney Frank of Massachusetts.
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