With all the crazy weather, storms, and flooding around the Country, it’s no wonder homeowners have become a little nervous about flood damage and being able to obtain flood insurance. However, President Obama has recently signed into law the Homeowner Flood Insurance Affordability Act (HR 3370) to address this concern.
In 2012, the Biggert-Waters Flood Insurance Reform Act was adopted, and required flood insurance policies to transition to actuarial premiums. This resulted in exorbitant increases to flood insurance premiums, rendering flood insurance unaffordable to many homeowners. The newly signed Act creates a different flood insurance premium structure, including but not limited to, lowering FEMA’s ability to raise rates and a requirement that FEMA complete the affordability study and framework. These new requirements will result in lower overall flood insurance premiums for owners.
If more homeowners will now be able to afford flood insurance, how will this impact homeowner associations? Will this make it easier for associations to manage their own insurance and allow for a better process for claim submissions by owners and associations? Please share your thoughts. For more information on flood insurance and associations, see our article But We Don’t Live By the Water . . . Common Misconceptions of the National Flood Insurance Program.