President Barack Obama signed legislation that stops measures which would significantly raise flood insurance rate increases as proposed in the Biggert-Waters act.
The new law includes protections for homeowners that would allow for rates to increase only so much, capping them in an effort to prevent “year-over-year skyrocketing rate hikes,” a release from the office of Sen. Mary Landrieu (D-La.) said.
“It has been a long and arduous two-year battle to reach today,” Landrieu said in a statement. “But our work is not done. Nothing is perfect. Nothing is permanent. We must continue our efforts to craft an affordable flood program that works decade after decade so generation after generation can continue to affordably and safely live along our coasts and inland waterways where they work to power our nation’s economy.”
“The Grimm-Cassidy flood insurance reforms will reinstate grandfathered rates, cap premium increases, reform the FEMA flood mapping process and help stabilize our housing market,” added Rep. Bill Cassidy (R-La.), co-author of the House bill.
According to Rep. Cedric Richmond (D-La.), the new law will affect 200,000 in Louisiana and 5.5 million Americans.
“My colleagues and I heard your calls for reform and immediately got to work on a bipartisan solution and after a long journey we passed significant legislation that will ease the burden of rising flood insurance premiums,” Richmond said.
Rep. Steven Scalise (R-La.) said the proposal “provides Louisiana families with serious, long-term solutions
“Louisiana families finally have the peace of mind in knowing that a real solution to the long-fought battle to provide flood insurance relief to homeowners has been signed into law,” Scalise said.
Included in the new law,
- There will be a rate cap of 18 percent to prevent skyrocketing increases;
- FEMA must keep flood insurance policies under one percent of a property’s total coverage and must report when it can’t;
- FEMA must review and report how new rates affect small business, churches and non-profits;
- FEMA maps must be accurate and reliable;
- Funding must be provided to reimburse individuals and communities that successfully appeal FEMA’s flood map;
- Communities will get credit for local levees and non-structural mitigation features.
“This law protects homeowners who played by the rules and keeps real estate markets alive while putting the NFIP on a more realistic path to solvency,” said Michael Hecht, president and CEO of Greater New Orleans, Inc.