Flood Insurance Reform Act of 2011
Floor Speech
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Mrs. CAPITO. Madam Chair, I rise in support of the legislation that is before us today to reform the National Flood Insurance Program.
I would like to thank the gen tle lady from Illinois (Mrs. Biggert) and the gen tle lady from California (Ms. Waters) for their hard work to bring forth a bipartisan bill which addresses many of the concerns to a program hampered by extraordinary losses and currently facing about $18 billion of debt.
H.R. 1309 provides a long-term extension of the National Flood Insurance Program, but it makes a significantly indebted program more fiscally sound. A 5-year reauthorization will give the certainty that is needed to a program that has been without it for the past 2 years. It is irresponsible and unfair to communities and individuals, especially those who live in flood-prone areas such as mine, to pass short-term extensions and allow temporary lapses when more than 5 million policyholders depend on it for financial security against flooding. Unless congressional action is taken, on September 30, 2011, these policyholders will again be put in danger of losing protection.
Unfortunately, the persistence of subsidized rates for properties in high-risk areas has left the NFIP underfunded and at risk. This bill makes needed reforms to put premiums more in line with risk by incorporating actuarial rates for at-risk properties. Increasing the limit on annual premium rate increases will gradually phase out subsidized premiums and help reduce taxpayer exposure. At the same time, this legislation allows properties relief from the mandatory purchase requirement for up to 3 years so they may be able to plan better for being newly mapped into special flood hazard areas.
Most importantly, this bill gives us a chance to give long-term certainty to policyholders as well as insurers who participate in the program. In a still unsure housing market, it is critical that we provide as much clarity as possible to current and future homeowners.
I am very pleased that this legislation looks at privatization initiatives and the possibilities that the private market as well as reinsurance can play in protecting communities against future flood damages. It is my hope that we will pass this bill.
Again, I want to congratulate the chairwoman for her hard work.
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