New flood insurance bill will open market to private insurers

A national coalition that promotes fiscally sound approaches to natural catastrophe policy has applauded suggested changes to the National Flood Insurance Program, saying they will help open the flood insurance marketplace to private insurers.

SmarterSafer welcomed the bill by US Reps. Dennis Ross and Kathy Castor for re-introducing the Flood Insurance Market Parity and Modernization Act. The bill unanimously passed the House of Representatives last year with a 419-0 vote.

The body said it would help open the flood insurance marketplace to private insurers by easing regulations and allowing private insurance to fulfill mandatory purchase requirements.

In a statement, SmarterSafer.org said: “This bipartisan bill is an integral part of an ongoing effort to reform the National Flood Insurance Program—which is up for reauthorization in September but is almost $25 billion in debt.

“Fostering a more robust marketplace for private insurers will not only provide consumers with more options for purchasing flood insurance, but will help drive down prices across the board. We thank Representatives Ross and Castor for re-introducing this important legislation, and look forward to working with lawmakers from both sides of the aisle to reform the program this year so that it better protects lives, property and taxpayer dollars.”

The Flood Insurance Market Parity and Modernization Act would clarify federal rules to allow private companies into the flood insurance market. Specifically, the bill would: remove regulations that make it difficult for private companies to enter the flood insurance market; give states more flexibility to individually regulate private flood insurance as they see fit; and ensure that policyholders will not lose their flood insurance subsidies if they switch to a private insurer and then decide to switch back to the NFIP.