H.R. 5484: National Flood Insurance Program Reauthorization and Reform Act of 2025

This legislation, known as the National Flood Insurance Program Reauthorization and Reform Act of 2025, aims to continue and improve the National Flood Insurance Program (NFIP). Here is a summary of its key components:

Continuation and Improvements of the NFIP

The bill seeks to authorize the ongoing operation of the NFIP, while implementing measures such as:

• Premium Caps: Limits on insurance premium rates.
• Means-Tested Assistance: Financial help based on income levels for those who need help paying their premiums.
• Flood Mitigation Strategies: Strategies to reduce flood risks and improve safety.
• Data Transparency: Increased transparency regarding how data is collected and used within the program.
• Policyholder Protections: Measures to ensure fairness and protect the rights of policyholders.

Study on Flood Insurance Participation

A study will be conducted by the Comptroller General to explore ways to enhance participation in the flood insurance program. This includes examining:

• Program changes to increase participation.
• Automatic enrollment options.
• Bundling risk to encourage more coverage.

The study results are expected to be delivered in 18 months, focusing on coverage rates for federally backed properties and the economic implications of the updated Risk Rating 2.0 system.

Focus on Severe Repetitive Loss Properties

The bill aims to address the issue of severe repetitive loss properties and to decrease the number of flood insurance claims in both state and tribal jurisdictions. It emphasizes:

• Enhancing ratings in the Community Rating System, which rewards communities for floodplain management practices.
• Prioritizing funding for flood risk mitigation projects, especially in low-income areas and for vulnerable homeowners.
• Mandating transparency in the management of funding and project reporting related to these initiatives.

Dispute Resolution over Premium Rates

The legislation provides guidelines for addressing disputes regarding flood insurance premium rates, particularly for properties located in levee-protected zones. Key measures include:

• Assessing levee systems that may not be accredited.
• Establishing fair flood insurance rates based on accurate risk assessments.
• Creating an appeals process for communities that contest flood risk assessments.

Repeal of the Flood Insurance Reform Act of 2004

The bill repeals the Flood Insurance Reform Act of 2004 and transfers any pending appeals to a newly established Independent Office for Policyholder Appeals. Additional provisions include:

• Reforms to judicial review processes related to flood insurance.
• Management of issues related to underpayments and overpayments of claims.
• Requirements for disclosing claims information to policyholders.
• Ensuring that property flood hazard risks are disclosed during real estate transactions.

Disclosure Requirements

The legislation mandates that tenants receive important information regarding flood damage and insurance coverage prior to entering into lease agreements. It permits states to implement even stricter disclosure rules if desired. Furthermore, it establishes:

• A 90-day grace period for renewing flood insurance policies at previous rates.

Relevant Companies

• ALL (Allstate Corporation): A major insurer that may be impacted by changes in premium rates and claims processing.
• CB (Chubb Limited): Insurer that might adjust their flood insurance offerings based on new regulations and risk assessments.
• ACE (Lloyd's of London): An insurance market potentially affected by the bill's impact on flood risk pricing and mitigation requirements.