Congress urged to speed up passage of flood insurance parity bill

Pennsylvania insurance commissioner calls for quick passage of a proposed law that aims to encourage more private insurers to write flood insurance

Insurance News

By Louie Bacani

An insurance regulator has urged the US Congress to hasten the passage of the Flood Insurance Market Parity and Modernization Act following its recent approval by a lower house committee.
 
Pennsylvania Insurance Commissioner Teresa Miller hailed the vote of the House of Representatives Financial Services Committee approving the proposed measure that would amend the Flood Disaster Protection Act of 1973, encouraging more private insurers to write flood insurance.
 
“We are encouraged by the unanimous, bipartisan passage of this bill out of committee and are urging the full House of Representatives to consider this legislation soon, and the Senate to follow suit,” she said.
 
“We need our partners in the federal government to take this important step to make sure mortgages are available to homeowners with private flood insurance,” added Miller, who testified before the House Subcommittee on Housing and Insurance in January.
 
In her testimony, Miller said many lenders are unsure if private flood insurance coverage meets the requirements of the federal government.
 
Miller stressed that this obstacle impedes the increase of the availability of private flood insurance and makes lenders reluctant to issue mortgages for homes with coverage.
 
 “The Flood Insurance Market Parity and Modernization Act (H.R. 2901) would remove that obstacle by requiring lenders to accept private flood insurance if it complies with state laws and regulations and includes the required limits of coverage,” said Miller.
 
Mortgages backed by the federal government require flood insurance for homes in designated flood zones.  Almost all residential flood insurance products were used to be sold through the government-run National Flood Insurance Program (NFIP). 
 
The flood insurance market has become more attractive to private insurers due to recent premium increases for many homeowners with NFIP policies and the re-mapping of many other properties into flood zones by the Federal Emergency Management Agency.
 
“Providing options for homeowners when it comes to flood insurance is important to help consumers who need or want this coverage find it at more affordable prices,” Miller said.
 

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