Bill Overview
Title: Homeowner Flood Insurance Transparency and Protection Act
Description: This bill allows National Flood Insurance Program policyholders to elect to pay premiums at the rate in effect prior to the implementation of Risk Rating 2.0. Risk Rating 2.0 bases premium rates on an individual property's specific flood risk instead of the flood risk of a general location and property type. Policyholders may elect to pay the previous rate until the Federal Emergency Management Agency performs several actions regarding Risk Rating 2.0, including publishing all data and methods used to calculate premium rates under Risk Rating 2.0, creating an online database where policyholders can see premium rates for their property using specified calculations, and publishing an assessment of the economic and social impacts of Risk Rating 2.0.
Sponsors: Sen. Hyde-Smith, Cindy [R-MS]
Target Audience
Population: Policyholders of the National Flood Insurance Program
Estimated Size: 5000000
- The bill affects policyholders of the National Flood Insurance Program (NFIP).
- In 2020, about 5 million policyholders were enrolled in NFIP.
- Most NFIP policyholders are in flood-prone areas.
- Risk Rating 2.0 impacts those in higher flood risk areas as it bases premiums on the property's specific risk.
- The bill impacts policyholders opposed to premium increases under Risk Rating 2.0.
Reasoning
- The policy primarily affects NFIP policyholders in higher flood risk areas as it allows them to avoid increased premiums under Risk Rating 2.0.
- Due to the budget, the policy cannot support the entire NFIP population, but it can benefit those significantly impacted by premium rises.
- Many policyholders may not be directly affected if their premiums are unaffected by Risk Rating 2.0.
- The policy might have medium to high significance to residents in states like Florida, Texas, and Louisiana with high flood risk areas.
Simulated Interviews
Real Estate Agent (Miami, Florida)
Age: 45 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 5.0 years
Commonness: 3/20
Statement of Opinion:
- I was worried about how much my premiums would increase due to Risk Rating 2.0.
- This bill offers peace of mind and financial relief until more transparency is provided.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 5 |
| Year 2 | 8 | 5 |
| Year 3 | 9 | 4 |
| Year 5 | 9 | 3 |
| Year 10 | 7 | 3 |
| Year 20 | 6 | 2 |
Retired Engineer (Houston, Texas)
Age: 60 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 4.0 years
Commonness: 4/20
Statement of Opinion:
- Switching to old rates helps my limited budget.
- Transparency in how premiums are calculated is vital to manage my finances.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 4 |
| Year 2 | 7 | 4 |
| Year 3 | 7 | 4 |
| Year 5 | 6 | 3 |
| Year 10 | 6 | 3 |
| Year 20 | 5 | 2 |
Environmental Scientist (New Orleans, Louisiana)
Age: 30 | Gender: other
Wellbeing Before Policy: 7
Duration of Impact: 1.0 years
Commonness: 5/20
Statement of Opinion:
- This policy doesn't directly affect me now, but it’s nice to know it exists in cases where I would decide to buy property here.
- Environmental assessment and historical data transparency are essential.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 7 |
| Year 10 | 7 | 7 |
| Year 20 | 7 | 7 |
Insurance Broker (Sacramento, California)
Age: 55 | Gender: male
Wellbeing Before Policy: 6
Duration of Impact: 3.0 years
Commonness: 4/20
Statement of Opinion:
- My concern is primarily for my clients; anything that stalls premium hikes helps them.
- The economic assessment part of the bill is something to look forward to.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 6 |
| Year 2 | 7 | 6 |
| Year 3 | 7 | 6 |
| Year 5 | 6 | 5 |
| Year 10 | 6 | 5 |
| Year 20 | 5 | 4 |
Elementary School Teacher (Savannah, Georgia)
Age: 40 | Gender: female
Wellbeing Before Policy: 5
Duration of Impact: 5.0 years
Commonness: 3/20
Statement of Opinion:
- I was dreading my premium notices every year. Keeping them at the same rate helps keep household expenses stable.
- More transparency always helps familial peace of mind.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 5 |
| Year 2 | 8 | 5 |
| Year 3 | 9 | 4 |
| Year 5 | 9 | 3 |
| Year 10 | 7 | 3 |
| Year 20 | 6 | 2 |
Contractor (Phoenix, Arizona)
Age: 50 | Gender: male
Wellbeing Before Policy: 8
Duration of Impact: 0.0 years
Commonness: 10/20
Statement of Opinion:
- This doesn’t affect me as I'm under low flood risk population.
- Being informed about these policies helps general awareness of real estate values.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 8 |
| Year 2 | 8 | 8 |
| Year 3 | 8 | 8 |
| Year 5 | 8 | 8 |
| Year 10 | 8 | 8 |
| Year 20 | 8 | 8 |
Freelance Writer (Atlanta, Georgia)
Age: 27 | Gender: female
Wellbeing Before Policy: 7
Duration of Impact: 2.0 years
Commonness: 7/20
Statement of Opinion:
- The policy might be helpful if I decide to purchase property in a flood zone area.
- The concept of paying old rates seems fair considering lacking transparency for new rates.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 7 |
| Year 10 | 7 | 7 |
| Year 20 | 7 | 7 |
Retired Teacher (Charleston, South Carolina)
Age: 65 | Gender: female
Wellbeing Before Policy: 6
Duration of Impact: 4.0 years
Commonness: 3/20
Statement of Opinion:
- Predictability in expenses is crucial on a fixed income.
- It's a relief that someone listens to the small homeowners' concerns.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 6 |
| Year 2 | 8 | 6 |
| Year 3 | 7 | 5 |
| Year 5 | 7 | 5 |
| Year 10 | 6 | 4 |
| Year 20 | 6 | 4 |
Urban Planner (Portland, Oregon)
Age: 35 | Gender: male
Wellbeing Before Policy: 7
Duration of Impact: 2.0 years
Commonness: 6/20
Statement of Opinion:
- Understanding flood insurance adjustments' impacts on development planning is crucial for my work.
- While I'm not personally affected, client knowledge impacts.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 7 | 7 |
| Year 2 | 7 | 7 |
| Year 3 | 7 | 7 |
| Year 5 | 7 | 7 |
| Year 10 | 7 | 7 |
| Year 20 | 7 | 7 |
Hotel Owner (Cape Cod, Massachusetts)
Age: 42 | Gender: male
Wellbeing Before Policy: 5
Duration of Impact: 5.0 years
Commonness: 2/20
Statement of Opinion:
- Anything to prevent premium spikes helps maintain business viability.
- The tourism industry is already vulnerable; I support this temporary measure until more fairness and transparency is demonstrated in rates.
Wellbeing Over Time (With vs Without Policy)
| Year | With Policy | Without Policy |
|---|---|---|
| Year 1 | 8 | 5 |
| Year 2 | 8 | 5 |
| Year 3 | 8 | 4 |
| Year 5 | 7 | 4 |
| Year 10 | 6 | 3 |
| Year 20 | 5 | 2 |
Cost Estimates
Year 1: $150000000 (Low: $100000000, High: $200000000)
Year 2: $120000000 (Low: $80000000, High: $160000000)
Year 3: $100000000 (Low: $70000000, High: $130000000)
Year 5: $85000000 (Low: $60000000, High: $110000000)
Year 10: $0 (Low: $0, High: $0)
Year 100: $0 (Low: $0, High: $0)
Key Considerations
- NFIP is crucial in managing flood risk in the U.S.
- Delaying Risk Rating 2.0 could affect NFIP's financial sustainability.
- Transparency and public perception could improve with online access to data and calculations.