Dear Chairman Crapo and Ranking Member Brown:

I am writing to urge the Committee to include the bipartisan Flood Insurance Market Parity and Modernization Act in any reauthorization bill.  This bill, which passed the House 419-0 last year and recently passed out of the House Financial Services Committee unanimously is needed to clarify that consumers can choose private flood insurance — if it is available.  Unfortunately, when Congress attempted to clarify this in 2012, the language was unclear.  As a result, lenders are unclear on what they can accept to satisfy mandatory purchase requirements.  The Heller-Tester bill merely clarifies what has been law — ”namely, that consumers can choose private flood policies to satisfy these mandatory purchase requirements.

Allowing consumer choice in flood policies should be a clear policy goal in this reauthorization package: it would help provide affordable options for homeowners at risk; it would expand the number of people purchasing needed flood coverage; and it would take risk off of the federal government.

As you know, the federal flood insurance program is deeply in debt and we should be encouraging competition to better protect taxpayers, while providing consumers with affordable choice.  Recent studies from the Reinsurance Association of American and Milliman actually show that private insurance options will not only be more affordable for a majority of homeowners, but it can shore up the NFIP, creating a more stable flood program. This is a pro-consumer measure.


Steve Pociask
American Consumer Institute
Center for Citizen Research
1701 Pennsylvania Ave., NW, Suite 300
Washington, DC  20006