CHARLESTON, WV -- Private insurers could soon start offering flood insurance to West Virginians.
Sen. Rocky Fitzsimmons, D-Ohio, introduced Senate Bill 621, which would allow the private insurance market to sell affordable flood insurance in the state.
The bill's introduction comes about a week after the Senate adopted House Concurrent Resolution 42, urging Congress to revise the Biggert-Waters Flood Insurance Reform Act of 2012. Some unintended consequences have resulted from the law, which changes the way the National Flood Insurance Program is run.
According to the Federal Emergency Management Agency website, "key provisions of the legislation will require the NFIP to raise rates to reflect true flood risk, make the program more financially stable, and change how Flood Insurance Rate Map (FIRM) updates impact policyholders."
Although the rates have increased in an effort to mitigate flood damage done by Hurricane Katrina and Superstorm Sandy, some West Virginia homeowners are feeling the burden. Fitzsimmons' bill would put a stop to that.
"Most people who purchase a home don't do so with cash," Fitzsimmons said.
"They need to go to a bank to borrow money to do that. When you do that, those are federally insured loans and they require you purchase flood insurance to protect that purchase.
Fitzsimmons said creating an environment of competition would help drive down rates and ensure efficiency. The bill also outlines different options for insurance coverage. Consumers could purchase insurance that would cover total replacement cost on their home, or enough to cover what is left on their mortgage.
"Those additional options for coverage will also provide consumers a choice for what level of risk they want to assume and will give them the option for lower premiums in West Virginia," Fitzsimmons said.
Because of the rising cost of flood insurance, many people in Fitzsimmons' home district of Ohio County are finding they can't sell their homes. He said some older residents want to retire to other places, but potential homebuyers pull their loan applications when they find out how expensive flood insurance is.