WASHINGTON – U.S. Senator Bill Cassidy, M.D. (R-LA) delivered a speech on the U.S. Senate floor highlighting rising National Flood Insurance Program (NFIP) premiums in Louisiana and around the country. He called on Congress to take action to make the NFIP affordable again and address Risk Rating 2.0. This is the fifth installment of a series of Senate floor speeches Cassidy is using to focus attention on flood insurance costs.
“A few months ago, I shared several stories my team and I have heard from Louisianans about the issue. Their stories matter. These are the stories of Americans struggling to get by. And their voices deserve to be heard. So I am back today to share a couple more,” said Dr. Cassidy.
“We’ve seen flooding in states that don’t typically make you think ‘flooding’,” continued Dr. Cassidy. “You may be surprised to hear that Ruidoso, New Mexico—a small village in south-central New Mexico—has faced 13 flash flood emergencies since June 19 of this year due to runoff from heavy rain. On July 17, homeowners in Nashville, Illinois were devastated when the town’s dam flooded and caused damage to dozens of homes. On May 24, Montana Governor Greg Gianforte issued an executive order declaring a statewide disaster in response to recent flooding in northern and central Montana. Residents of Appleton, Wisconsin also faced widespread damage from a flash flood earlier this month.”
“Every single member of this body has constituents who rely on the National Flood Insurance Program,” concluded Dr. Cassidy. “My team is working on a bipartisan solution that will roll back Risk Rating 2.0, and make flood insurance affordable and accountable again. Let’s find a way forward.”
Background
In January, the U.S. Senate Banking Committee held a hearing on NFIP at the request of Cassidy. The hearing highlighted the urgent need for Congress to act and featured a Louisiana witness. Cassidy also participated in a roundtable hosted by GNO, Inc. and the Coalition for Sustainable Flood Insurance before introducing the bill to hear from community leaders and advocates on the issue.
Cassidy traveled St. Bernard Parish last August to talk with residents about their flood insurance premiums, resulting in the second episode of his series Bill on the Hill.
Cassidy’s remarks as prepared for delivery are below:
Madam President,
The National Flood Insurance Program—or NFIP—was created to protect Americans and their families.
It covers 4.7 million American homes.
But NFIP fails to serve that core function when it becomes too expensive to afford.
FEMA’s new risk assessment system—Risk Rating 2.0—has blindsided homeowners with unprecedented spikes in their insurance premiums, and it was never passed by Congress.
I speak to constituents constantly about flood insurance.
A few months ago, I shared several stories my team and I have heard from Louisianans about the issue.
Their stories matter. These are the stories of Americans struggling to get by.
And their voices deserve to be heard.
So I am back today to share a couple more.
One resident in New Orleans who is nearing retirement told us she was struggling to keep up with rising premiums because they no longer allowed her home to be grandfathered in.
Her house was built in 1987 up to the standards under the flood map at the time. She did everything right.
Her house flooded during Katrina—like so many did—but again, she was saved from skyrocketing premiums until Risk Rating 2.0.
Now she tells us her future premiums will eventually rise to over eight thousand dollars.
Her hazard insurance is almost 12 thousand dollars and growing each year.
She wrote to my office, quote: “There is no way I will be able to retire and afford the premiums, I can hardly pay them now!”
There is no way I will be able to retire.
Her story is one that’s shared by many homeowners in our state.
I heard from another woman in the City of Central, Louisiana, just outside of Baton Rouge.
It’s an area that doesn’t often flood.
As she put it: in order for her house to flood, the whole City of Central would need to be underwater.
But when Risk Rating 2.0 hit, she learned her premium would quadruple if she opted for the coverage she wanted.
So, she dropped her coverage altogether.
And that’s the problem with blindsiding people with dramatically higher rates.
If they don’t flood, and they can’t afford insurance, why would they keep their coverage?
When that happens, the pool of policyholders shrinks, and the program enters what’s called an actuarial death spiral.
FEMA itself forecasted that over 20 percent of policyholders would leave the program within 10 years.
We are setting the program up for collapse.
And these aren’t only the wealthy and those with three homes we are making pay more.
62 percent of all NFIP policies are in parishes and counties where the median household income is below the national average of about 54 thousand dollars.
These are hard-working families, not millionaires’ beach homes.
And it’s not just Louisiana families getting hit here.
We’ve seen flooding in states that don’t typically make you think “flooding”.
Virginia, Missouri, North Carolina, South Carolina, New York, New Jersey, Florida, Alabama, Mississippi, Pennsylvania, Texas, California, and Louisiana are all states that have had more than one billion in NFIP claims since 1978.
Those are the states in dark yellow that have been hit the hardest.
44 states have had over fifty million in total NFIP claims, and every single state has had at least five million in claims.
You may be surprised to hear that Ruidoso, New Mexico—a small village in south-central New Mexico—has faced 13 flash flood emergencies since June 19 of this year due to runoff from heavy rain.
On July 17, homeowners in Nashville, Illinois were devastated when the town’s dam flooded and caused damage to dozens of homes.
On May 24, Montana Governor Greg Gianforte issued an executive order declaring a statewide disaster in response to recent flooding in northern and central Montana.
Residents of Appleton, Wisconsin also faced widespread damage from a flash flood earlier this month.
New Mexico, Illinois, Montana, and Wisconsin.
These are not places that typically make you think “flooding.”
This is a national issue, not just a coastal issue.
Let me say to my colleagues who represent those states and to all my colleagues: come talk to me about it. Let’s have a conversation.
Every single member of this body has constituents who rely on the National Flood Insurance Program.
My team is working on a bipartisan solution that will roll back Risk Rating 2.0, and make flood insurance affordable and accountable again.
Let’s find a way forward.
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