U.S. Rep. Gus Bilirakis announced Thursday that he’d filed legislation that would cap flood insurance premiums and slowly phase in rate increases over a 10-year period.
The bill would cap premiums so they don’t exceed the home’s appraised value at purchase over the length of a mortgage.
The legislation also would clarify that homeowners are allowed to pay premiums on a monthly basis rather than as an annual lump sum or biannually, the congressman’s office said in a statement. The current law states that the National Flood Insurance Program can collect premiums annually or in more frequent installments, but the rules don’t specify the frequency, Bilirakis’ aide Sarah Criser said in an email.
The measure is the latest in a series of bills seeking to delay, stop or change dramatic rate increases going into effect this year in the government’s flood program.
“Homeowners across the country are currently facing significant rate increases as a result of reforms made to address the solvency of the NFIP,” Bilirakis, R-Palm Harbor, said in a press release.
“This legislation is a backstop for catastrophic rate increases that have not only created significant hardship for hardworking Americans but also have the potential to limit or freeze home sales that would help in the recovery of our already fragile housing market.”
The reforms enacted by the 2012 Biggert-Waters Act will raise rates on older homes at high risk for flood that had been receiving artificially low rates. The program is about $24 billion in debt following major catastrophes such as hurricanes Katrina and Sandy
Thousands of homes in Florida face serious premium hikes under the new law, exceeding $20,000 a year in the worst cases.
U.S. Sen. Bill Nelson has also sponsored legislation to stop the implementation of the rate increases, along with several other lawmakers, but none of these bills have gone to a vote.