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Will this patch for the National Flood Insurance Program hold water?

Backers say it better spreads cost of risk

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SmarterSafer.org is putting its weight behind an amendment drafted by U.S. Sen. Pat Toomey, R-Penn., designed to address affordability issues in the National Flood Insurance Program (NFIP).

"The Toomey amendment — which has no cost to taxpayers – will address the Administration’s concerns with delaying needed reforms to NFIP, while protecting policyholders from high rate increases, putting the program on sounder financial footing, and protecting the environment and those in harm’s way," a spokesman said.

The Toomey amendment will slow down rate changes in the program so that policyholders do not see steep rate increases—rate increases are capped at 25% of current premium per year.  

This is a significant change from Biggert-Waters which charges full risk-based rates upon home sales and provides a five-year phase-in for those remapped into higher risk areas.  

The Toomey amendment will significantly lengthen the phase-in time, allowing people a much longer transition period while FEMA continues to conduct its study on affordability. This gives FEMA and Congress time to come up with a comprehensive plan to help those policyholders who cannot afford their full risk-based premium. 

SmarterSafer.org continues to oppose Senate Bill 1926, the Homeowner Flood Insurance Affordability Act of 2014.

"Instead of continuing subsidies regardless of need, Sen. Toomey has put forth an alternative that provides a glide path for those who living in harm’s way, giving those policyholders time to consider mitigating their risk to protect their lives and property, well before paying full risk-based rates," the spokesperson said.

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