In the past several months, we have been updating you on the progress Congress is making about the upcoming expiration of the National Flood Insurance Program on December 8th 2017.


In the US House, an agreement has been reached between House Leadership and Chairman of house financial services Representative Hensarling to move the US House package forward to reauthorize NFIP for 5 years.


There have been major concessions made to the original house package.  In short, they are:

  • Protections for Grandfathering and Changes to Treatment of Repetitive Loss Properties – This means that only after a policyholder has filed two claims AFTER enactment of this bill (should it become law) would they sustain a rate increase because they filed a claim.  After the filing of a second claim, rates on that property will increase 10% annually, and after the filing of a third claim, rates will increase by 15% annually until full risk rates are met. If you are already paying a full risk rate, your rate will not increase.
  • Prioritization of Mitigation Dollars – Mitigation dollars will be prioritized for properties that have flooded, and past claims can be counted for that prioritization.
  • Excessive Lifetime Claims – This change increases the threshold for properties to be classified as those with excessive lifetime claims to mean any property that exceeds three times the amount of the replacement value of the structure.  After this threshold is met, the building is ineligible for NFIP coverage.

These concessions are in addition to concessions made earlier this year, including the preservation of grandfathering.

This is just the beginning in terms of the legislative process.  The House floor action needs to occur, with action expected as early as this week.  We are also waiting to hear what the Senate will do.


Bill language can be found HERE