Representatives Should Vote "Yes" on Flood Insurance Reform

NTU urges all Representatives to vote “YES” on H.R. 2874, the “21st Century Flood Reform Act of 2017.” This legislation will begin to make the National Flood Insurance Program (NFIP) more stable and sustainable for both policy holders and taxpayers.

Years of heavily-subsidized premiums and natural disasters have led to NFIP running $46 billion in the red, with no clear way of managing its financial obligations in the long-run. Below-market insurance rates have incentivized homeowners to live in flood-prone areas, creating a dangerous moral hazard. These homes are more likely to be victim of repetitive flooding, a category of properties that constitute just about one percent of NFIP policies but account for nearly 30 percent of payouts. Furthermore, substantial barriers remain for private flood insurers hoping to enter the market, leaving taxpayers on the hook to payout claims.

H.R. 2874 will begin to address these problems by moving toward more accurate risk-based insurance rates, ensuring consumers can choose private flood insurance, adjusting premiums on repeatedly-flooded properties, and making improvements to flood mapping. While more reform is needed, without these proposed changes, NFIP will continue to balloon its debt, leaving taxpayers at risk of another bailout of the program.

Roll call votes on H.R. 2874 will be included in our annual Rating of Congress and a “Yes” vote will be considered the pro-taxpayer position.