Monday, 1 October 2007
House Passes Legislation To Expand Flood Insurance
The U.S. House of Representatives passed legislation last week to expand the National Flood Insurance Program (NFIP), which provides homeowners with affordable coverage in high flood-risk areas.
The bill would increase the NFIP’s borrowing capabilities to $21.5 billion from $20.8 billion last year. It would also phase out around 450,000 government subsidies given for vacation homes, second homes, and commercial property built prior to 1974 — saving roughly $335 million a year, according to the Associated Press.
The Federal Emergency Management Agency (FEMA) would be able to increase rates based upon risk under the new bill — but they also must update all of the nation’s flood maps.
White House officials have recommended the President veto the measure because it includes insurance coverage for windstorm damage. Currently any damage caused by wind is the homeowners' responsibility.
The White House contends the wind damage provision would be “fiscally irresponsible” and that it would “shift liabilities for windstorm damage from the private sector to the federal government.”
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