This week, U.S. Sen. Rick Scott, R-Fla., showcased three bills he brought out at the end of last month “to reform the National Flood Insurance Program (NFIP)” and “help lower the cost of flood insurance and ensure the property insurance market better serves Florida families.”
Scott’s “Removing Barriers to Private Flood Insurance Act” will “permanently eliminate the NFIP’s Write Your Own (WYO) company non-compete clause which currently prohibits WYO companies from selling private flood insurance products that compete with NFIP products.” He also introduced the “Flood Insurance Consumer Choice Act” which will “amend the NFIP’s ‘Continuous Coverage’ requirement and allow NFIP policyholders who leave the program to purchase a private policy to return to the NFIP without penalty.” Finally, Scott also introduced the “Flood Insurance Transparency Act” which will “require the Federal Emergency Management Agency (FEMA) to make detailed historic claims, policy and flood risk data available to the public and easily accessible, while protecting personal information as required by law.”
On Thursday, Scott’s office offered some of the rationales for the three bills.
“According to FEMA data, since the inception of the NFIP, Florida policyholders have paid more than $19 billion in premiums, but only collected approximately $5.6 billion in claims reimbursements, which equates to a nearly 4 to 1 ratio of premiums paid to claims reimbursements. The situation Florida families face is clearly unfair and exactly why Congress must make reforms to encourage participation in the private flood insurance market as an alternative for hardworking Americans across our country,” Scott’s office noted.
Scott weighed in on the proposals on Thursday.
“The National Flood Insurance Program is a perfect example of what happens when government tries to take over an industry – it fails. The NFIP is not only buried in debt, it’s now pushing huge rate increases through FEMA’s new ‘Risk Rating 2.0’ that is unsustainable and unaffordable for Florida families. When we increase availability and competition in the market, more homeowners get insured and taxpayers and homeowners are better off. If the private sector can offer families better coverage, better service and a better price, why would we deny them of that?” asked Scott.
Scott also cited his experiences on the matter during his two terms as governor.
“While I was governor, we reformed Florida’s property insurance market to better serve families and we can do it at the federal level too. It’s time to make commonsense reforms that better serve Florida families. I am committed to fighting for change that encourages the development of a robust and affordable private flood insurance market and gives homeowners more choice and flexibility when purchasing their flood insurance plans. I know many of my colleagues in the Senate agree with me on this, and I urge them to join me in passing these good bills,” Scott said.
All three bills were sent to the U.S. Senate Banking, Housing and Urban Affairs Committee at the end of September. So far, Scott has not reeled in any co-sponsors for the bills and there are no companion measures over in the U.S. House.