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Increased Cost of Compliance Modernization Act of 2022
12/29/2022, 10:03 PM
Summary of Bill HR 7221
One key provision of the bill is the establishment of a grant program to assist homeowners in implementing flood mitigation measures to reduce the risk of future flooding and lower insurance premiums. This program would provide financial assistance to homeowners for projects such as elevating homes, installing flood barriers, and improving drainage systems.
Additionally, the bill includes provisions to streamline the process for homeowners to access funds for flood mitigation projects and to increase transparency and accountability within the NFIP. This includes requiring the Federal Emergency Management Agency (FEMA) to provide regular updates on the status of flood insurance claims and to improve communication with policyholders. Overall, the Increased Cost of Compliance Modernization Act of 2022 aims to make the NFIP more responsive to the needs of homeowners and communities facing the increasing costs and risks associated with flooding. By providing additional resources and support for flood mitigation efforts, the bill seeks to help homeowners better protect their properties and reduce the financial burden of flood insurance.
Congressional Summary of HR 7221
Increased Cost of Compliance Modernization Act of 2022
This bill increases insurance coverage available to structures in high-risk flood areas under the National Flood Insurance Program (NFIP), commonly known as Increased Cost of Compliance (ICC) coverage. ICC coverage applies to costs related to flood mitigation requirements for repairs to, or the rebuilding of, flood-damaged structures with existing NFIP coverage.
Currently, ICC coverage is capped at $30,000. The bill increases this amount to 20% of the maximum amount of flood insurance coverage (currently $50,000) with additional coverage available of up to 40% of the maximum amount of coverage (currently $100,000).
The bill removes the cap on ICC premiums and requires the premium amount to be calculated pursuant to other NFIP rates. Additionally, ICC coverage does not count towards the cap on overall NFIP coverage.
Finally, ICC policyholders are allowed to assign the rights or benefits of this coverage to a governmental agency to satisfy certain cost-sharing requirements applicable to mitigation assistance programs.
