Great news for home owners purchsing homes in flood areas: Congress passes and the President signs the Home Owner’s Flood Insurance Affordability Act…
The key pieces of this legislation include:
- Cap for annual rate increases
- Eliminates the property sales trigger – Repeals the provision in Biggert-Waters that required home buyers to pay the full-risk rate for pre-FIRM properties at the time of purchase.
- Eliminates the new policy sales trigger – Repeals the provision in Biggert-Waters that required pre-FIRM property owners to pay the full-risk rate if they voluntarily purchase a new policy.
- Brings back grandfathering – Had grandfathering been terminated, property owners whose homes were now considered in a higher risk zone would have to either elevate their structure or have higher rates phased in over 5 years. The Home Owner’s Flood Insurance Affordability Act allows grandfathering to continue and sets limits on how high premiums can increase annually.
- FEMA is now required to refund policyholders for overpaid premiums.
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