The National Association of REALTORS® continued its crusade for National Flood Insurance Program reform in a testimony this week, delivered by Mabél Guzmán, a Chicago-based REALTOR®.
While at a hearing held by the House Financial Services Committee on Wednesday, Guzmán highlighted the importance of reform, especially in light of recent storms:
“The embattled National Flood Insurance Program is central to U.S. disaster preparedness efforts,” she stressed. “According to NAR research, the program is also essential to completing half a million home sales per year, each of which contributes two jobs and $80,000 to America’s economy. However, the NFIP was not designed nor intended to address the catastrophic loss years we have seen since 2005, meaning the program is not sustainable as currently structured.”
NAR has advocated for long-term NFIP reform for some time, concerned that the continuous extension of the program is unsustainable. NAR has advocated for changes to flood mapping and mitigation, as well as an expansion of the flood insurance market, which has been limited in privatizing by red tape.
Additionally, NAR has emphasized the importance of improved rates based on risk, and the need for phased-in raises. There is also the challenge of continuously flooding properties, which are 2 percent of NFIP policies, but comprise 25 percent of settlements.
In December, Congress authorized NFIP operations through May 31, 2019. Shortly after, FEMA, which administers the program, ceased NFIP operations as part of the shutdown. The agency ended the hiatus after five days, citing opposition.
“Flooding is not just a coastal issue,” Guzmán testified. “Roughly half of all flood disaster declarations since 1990 occurred in landlocked states. As we have seen, a never-ending string of short-term extensions only maintains an uncertain status quo, while program shutdowns jeopardize homes, businesses, communities and the U.S. economy. NAR stands ready to work with this Committee to pass meaningful NFIP and private-market reforms that help property owners and renters prepare for and recover from future flood losses.”
Following the testimony, NAR’s senior vice president of Government Affairs, Shannon McGahn, stated, “We’re encouraged to see today’s hearing focus on the need for reforms to flood mapping systems—changes which will make claims more accurate and increase transparency for potential homebuyers. Along with a focus on the private flood insurance market, these priorities will be critical building blocks as we move forward in NFIP reform discussions.”
Guzmán is affiliated with @properties.
For more information, please visit www.nar.realtor.
Suzanne De Vita is RISMedia’s online news editor. Email her your real estate news ideas at firstname.lastname@example.org.