As a follow on to last week’s article about the agreement by the Senate to initiate debate to delay increases mandated by the Biggert-Waters Flood Insurance Reform Act of 2012, the Senate recently passed (67-32) the Menendez-Isakson Homeowner Flood Insurance Affordability Act which will delay the Biggert-Waters Act until such time as FEMA can complete an affordability study, provide solutions to mitigate their effect and scientifically certify accuracy of the maps used to determine insurance rates on specific properties.

According to FEMA, key provisions of the Biggert-Waters act required “the NFIP (National Flood Insurance Program) to raise rates to reflect true flood risk, make the program more financially stable, and change how Flood Insurance Rate Map (FIRM) updates impact policyholders.” These rate increases were to begin at the end of last year. The law was developed as a result of the inundation of insurance claims posted after Hurricane Katrina, which put the NFIP on the verge of bankruptcy. Further stress was added following Hurricane Sandy.