This week, Sens. Michael Crapo (R-Idaho) and Sherrod Brown (D-Ohio) introduced the “NFIP Reauthorization Act of 2017,” which would reauthorize the NFIP for six years. The No. 1 priority for the Big “I” is timely reauthorization of the NFIP, and the association supports the bill as introduced.

Sens. Crapo and Brown are the top Republican and Democrat on the U.S. Senate Committee on Banking, Housing and Urban Affairs, which has jurisdiction over the NFIP. As such, this bipartisan legislation is an important indicator of where the Senate may be headed on any comprehensive reform bill. The committee is expected to consider a revised version soon. 

Big “I” staff prepared a one-page summary of the legislation, which mainly focuses on mitigation and seeks to address repetitive loss properties and high-risk communities. Of greatest note for independent agents is what the legislation does not include: cuts to the WYO program. However, amendments and numerous changes are expected as the bill moves through the legislative process. The Senate has introduced other pieces of legislation to make changes to the program, including a bill that would cut the WYO reimbursement rate from its current 30.9% to 22.46%.

The bill also does not include any provisions related to private flood insurance coverage, such as language to clarify that a private policy can satisfy mandatory purchase requirement for flood insurance, including on FHA-insured mortgages. It also does not include language that would allow private flood insurance to satisfy NFIP continuous coverage requirements—an important errors & omissions protection for agents. However, the Senate has introduced separate legislation that would address some of these issues.

This Senate bill is also significantly pared down from a legislative package in the U.S. House of Representatives that passed the Financial Services Committee in June, but has yet to be considered by the full House.

Unlike the House legislation, the Crapo-Brown bill does not include any provisions related directly to claims, rate increases, grandfathering or provisions that limit NFIP access for certain properties. The House legislative package currently includes such provisions, as well as a 3% cut in the WYO reimbursement rate and the provisions on private market development mentioned above.

As the Sept. 30 deadline to reauthorize the NFIP inches closer, the Big “I” will continue to keep members up to date on the most important developments and engage with Congress to ensure that any changes recognize the important role agents play in helping consumers make informed decisions about purchasing NFIP policies.

Jennifer Webb is Big “I” federal government affairs counsel.