U.S. Rep. Bill Pascrell, Jr. (D-NJ-8) today voted with the House majority in favor of the Flood Insurance Reform Priorities Act (H.R. 5114). The legislation, which passed the House with a vote of 329-90, includes Rep. Pascrell's amendment that makes the purchase of flood insurance easier for homeowners whose properties were added to updated floodplain maps.
"This legislation makes important changes in the way homeowners insure their property in floodplains throughout the nation," said Pascrell, who successfully urged for federal aid to New Jersey's flooded areas after the March 12 nor'easter. "Given the tremendous losses endured by so many residents during last spring's floods, I had to make sure that the people who live in the Passaic River Basin had full benefit of this legislation. It is my hope that this will give our residents greater peace of mind and affordable protection of their homes."
Federal law requires property owners in floodplain to purchase flood insurance.
The bill, H.R. 5114, includes an important new protection for residents whose homes are newly added to flood zones when new maps are issued. The legislation provides a five-year delay -- from the date the maps go into effect -- in making the purchase of insurance mandatory.
After the five year delay, the full rates will be gradually phased in at 20 percent a year during the next five years.
The bill's original version made this provision retroactive to Sept. 1, 2008, which would be of no benefit to Passaic County residents. Passaic County's most recent flood maps went into effect on Sept. 29, 2007.
Rep. Pascrell's amendment moved the bill's retroactive date back to Sept. 1, 2007, allowing property owners in the Passaic River Basin to have the full benefit of the legislation.
The bill also reauthorizes the National Flood Insurance Program (NFIP) for five years and some of the key provisions in this legislation include:
Providing the first increase in flood insurance coverage limits since 1994.
Phasing out premium subsidies for non-primary residences, such as second homes and vacation homes, and for commercial properties.
Creating an installment payment program for flood insurance premiums.
Creating the office of the Flood Insurance Advocate to assist policyholders' interactions with the NFIP.
Increasing the penalties for lenders misrepresenting the requirements of the NFIP in order to push borrowers to purchase coverage in excess of that which is legally required.
This bill is supported by numerous organizations, including the National Association of Realtors, the National Association of Homebuilders, the American Insurance Association, the Property Casualty Insurers Association, and the Independent Insurance Agents and Brokers of America.