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Pallone & Pascrell Announce Support for Comprehensive Flood Insurance Reform Bill

June 16, 2017
Press Release

Washington, D.C. – Today, Congressman Frank Pallone, Jr. (NJ-06) and Congressman Bill Pascrell, Jr. (NJ-09) announced their support for the Sustainable, Affordable, Fair and Efficient National Flood Insurance Program Reauthorization Act (SAFE NFIP) of 2017, and their intention to work with House colleagues to introduce companion legislation. The Congressmen have been leaders in demanding transparency and swift action on behalf of those who have suffered from inefficiencies and widespread fraud in the National Flood Insurance Program, and have championed the need for reforms of the program. The bipartisan legislation was announced today by Senator Bob Menendez and will take important steps to contain premium increases, provide premium affordability assistance and reform the process by which claims are reviewed.


“In the aftermath of Sandy many of my constituents found that, after responsibly paying for their flood insurance, their policy failed to provide the coverage they needed and deserved in their time of need. Many were prevented from repairing their homes and resuming their lives by a claims review process that moved too slowly and was riddled with fraud,” said Rep. Pallone. “Reforming the NFIP will allow us to increase the affordability of flood insurance and make it more effective when disaster strikes. That is why we look forward to working with our colleagues and championing companion legislation when it is introduced in the House of Representatives.”

“After seeing the devastation of Superstorm Sandy and all the challenges New Jerseyans faced in its aftermath, I know that getting the reauthorization of the National Flood Insurance Program right is a crucial aspect of preparing for a future storm” said Rep. Pascrell. “Reauthorization provides us with an opportunity to level the playing field for policy-holders, address waste, fraud, and abuse in the program, and bolster investments in mitigation to create real savings for policy-holders and long term stability for the program. That is why I look forward to working with my colleagues to introduce and pass companion legislation in the House of Representatives.”

The legislation includes:


The Sustainable, Affordable, Fair, and Efficient (SAFE) 
NFIP Reauthorization Act of 2017


Long-Term Certainty.  Reauthorizes the NFIP for six years, providing certainty for communities.

No Exorbitant Rate Hikes.  Ends runaway premium hikes by capping annual increases to 10 percent. Currently, premiums increase by up to 25 percent every year, depressing property values, creating affordability challenges, and discouraging participation in the program.

Cuts Wasteful Expenses to Pay for Investments.  Freezes interest payments and establishes new controls for private insurance company compensation in order to reinvest in proactive mitigation efforts and affordability measures, including low-interest loans for homeowners’ mitigation projects and affordability vouchers.

Strong Investments in Mitigation.  Provides robust funding levels for large-scale, communitywide mitigation efforts, and mitigation assistance programs, which have a 4:1 return on investment and are the most effective way to reduce flood risk. 

Expanded Increased Cost of Compliance (ICC) Coverage.  Increases the maximum limit for ICC coverage to better reflect the costs of mitigation projects and expands eligibility in order to encourage more proactive mitigation before natural disasters strike.

LiDAR Mapping.  Authorizes funding for Light Detection and Ranging (LiDAR) technology for more accurate mapping of flood risk across the country, reducing confusion and generating better data.

Oversight of Write Your Own (WYO) Companies.  Caps compensation for WYO companies to 22.4 percent of written premiums, creates new oversight measures for insurance companies and vendors, and provides FEMA with greater authority to terminate contractors that have a track record of abuse.

Claims and Appeals Process Reforms Based on Lessons from Sandy.  Fundamentally reforms the claims process based on lessons learned after Superstorm Sandy and other disasters, leveling the playing field for policyholders during appeals and litigation by holding FEMA to strict deadlines for payments to homeowners, banning aggressive legal tactics that prevent homeowners from filing legitimate claims and ending FEMA’s reliance on outside legal counsel from expensive for-profit entities.

Better Training.  Provides for increased training and certification of agents and adjusters to reduce mistakes and improve the customer experience.