Democratic Senators Look to Delay Flood Insurance Mandates

Purchasing new “market-based” flood insurance policies will not be a mandate for homeowners in new flood zones if two Democratic senators are able to pass legislation in the midst of the lame-duck session. Many homeowners have been placed into a new flood zone that would require them to pay for flood insurance, but the senators hope to stall this from occurring until the flood zone maps can be reviewed.

Senators Want to Stall Mandates for 5 Years

Democratic Sens. Charles Schumer (D-NY) and Richard Durbin (D-Ill.) are trying to push legislation that will give homeowners affected by new flood maps in districts like Long Island, NY and East St. Louis, Ill. a chance to challenge them before having to commit to new market-based flood policies.

Typically, a homeowner is not required to purchase flood home insurance unless their home is considered high-risk according to floodplain maps created by FEMA and the National Flood Insurance Program (NFIP). But when a home is included on one of the floodplain maps, the homeowner suddenly is required to purchase coverage to protect their home in the event of a flood.

In this case, homeowners in specific areas have been added to the maps and are now required to purchase higher-priced, market-based flood insurance policies. The senators hope to stall this mandate for five years and instead allow homeowners to pay low-cost preferred risk policies while giving them a chance to challenge whether their home should be on the map.

Critic Dislikes “Piecemeal” Legislative Approach

Critics of the senators’ legislation include the National Association of Mutual Insurance Companies (NAMIC). Jimi Grande, the senior vice president of federal and political affairs for NAMIC, was quoted recently as stating that the legislation is “short-sighted.”

He said he would prefer that Congress address the structural flaws inherent in the NFIP “rather than pursuing a piecemeal approach” that involves passing one legislation at a time without tackling the big issue. Also, he hopes that lawmakers will look at the total cost of the legislation in the long-run if a home is flooded without coverage.

There is no word as of yet on how Congress will move on the legislation, but with strongly opposing views already voiced on the issue, it could be in for a bit of a fight.