Flood Insurance Update

Posted on: March 28th, 2014 by Leslie_Zucker

This week Congress passed and the President signed into law the Homeowner Flood Insurance Affordability Act of 2014. The new law amends provisions of the Biggart-Waters Flood Insurance Reform and Modernization Act of 2012 that significantly reformed the National Flood Insurance Program. Both pieces of legislation have implications for homeowners in the Ashokan Watershed who hold flood insurance policies with the National Flood Insurance Program. The major changes that you can expect to see through the 2014 legislation are:

• Flood insurance premiums for primary owner occupied residences will increase 5% to 18% annually until actuarial rates are met (previously the increase was 25% a year).

• Pre-FRIM properties in the SFHA that are sold may continue to receive subsidized rates (previously rates were to go to actuarial once a subsidized property was sold).

• Lapsed policies may be renewed at subsidized rates (previously once a policy lapsed it could only be renewed at actuarial rates).

• Post-FIRM homes that were insured at subsidized rates will continue to receive subsidized insurance (previously they were to go immediately to actuarial rates)

• Homes that are newly remapped into a SFHA because of a map change can receive a preferred risk (subsidized) flood insurance policy for the first year. Afterwards their rates will increase 18% a year until actuarial rates are reached.

• A new surcharge for all flood insurance holders will be initiated. Primary residences with flood insurance will be see a $25 surcharge added to their bill, while owners of all other types of insured structures will see a $250 surcharge added to their bill.

 

Share