Last September, I gave an update on the National Flood Program as it relates to the compliance provisions of the Biggert-Waters Act. Well hang on because now that act has been modified by an even newer act; the Grimm-Waters Act.
The Homeowner Flood Insurance Affordability Act of 2014 was signed into law on March 21st, 2014. This law is also known as the Grimm-Waters Flood Insurance Reform Act repeals and modifies certain provisions of the Biggert-Waters Flood Insurance Reform Act, which was enacted in 2012. Grimm-Waters has many program changes to other aspects of the National Flood Insurance Program (NFIP). Many provisions of the Biggert-Waters Flood Insurance Reform Act remain and are still being implemented.
The new legislation has many provisions that differ from the Biggert-Waters bill. FEMA has provided and overview of these. They include:
1. Lowers the recent rate increases on some policies, prevents some future rate increases, and implements a surcharge on all policyholders.
2. Repeals certain rate increases that have already gone into effect and provides for refunds to those policyholders.
3. Authorizes additional resources for the National Academy of Sciences to complete the affordability study.
4. FEMA will be working with the private Write Your Own insurance companies in the next few weeks to seek their input and expertise prior to issuing business practice bulletins.
5. The new law does require some changes to be made retroactively, applying to certain policies written after July 6, 2012, other changes require establishment of new programs, processes and procedures.
