In the US, floods are known be among the prime destroyers of property and among the major causes of huge casualties. It is approximated that up to 90% of all natural disasters in the US are as a result of floods. Floods are caused by heavy rains and are very likely to occur in cases of hurricanes and other similar scenarios. However, despite the threat it poses and the risks involved in case of a flood, the damages resulting from floods are never covered in the standard homeowners’ insurance policy. This is one of the factors that contributed to the formulation of the flood insurance Act of 2014.
Signed into law on March 21st, 2014 by President Barack Obama, the Act largely known as the Homeowner Flood Insurance Affordability Act of 2014, HFIAA modifies several provisions previously held in the Biggert-Waters Flood Insurance Reform Act. However, various parts of the other Act continue to be implemented in spite of the 2014 Act, which was mainly an amendment. In addition, the 2014 Flood Insurance Act creates other supplementary changes in the program that were never covered in the preceding Act. Through the relevant agencies, this law is already being implemented gradually.
The Bill that was later passed and signed into law would see a delay in the increase in insurance premiums due to floods. Moreover, these reforms are intended to require insurance premiums due to floods to reflect the real risk of flooding which at some point led to an increase in premiums. During the delay provided in the bill, the Federal Emergency Management Agency, FEMA, would be required to formulate a concise plan to make the premiums cheaper and release its maps indicating those areas that are likely to be affected by the flood, and which would require flood insurance. In addition to the delayed commencement of increasing premiums, the bill also makes a provision for homeowners who sell their homes to pass the lower flood insurance premiums to the next person coming into the home.
This bill introduced into the Senate by Sen. Robert Menendez received its fair share of opposition as well as warm reception. Supporters argued that the bill was aimed at economic good of the American citizens adding that without such provisions in the constitution, the premiums would increase way past reach of most homeowners. On the other hands, opponents argued that this reform may hurt reforms linked to the $24 billion debt the NFIP is already facing.
All said and done, the bill was passed successfully and later signed into law. Opponents and proposers alike must now comply with the newly instituted regulations.