0
Homeowners’ Defense Act of 2023
3/9/2024, 4:45 AM
Summary of Bill HR 3997
One of the key provisions of the Homeowners' Defense Act is the establishment of a national catastrophe fund, which would provide financial assistance to homeowners who have suffered damage to their property as a result of a natural disaster. This fund would be funded through a combination of federal and state contributions, as well as premiums paid by homeowners.
Additionally, the bill aims to streamline the process for homeowners to obtain insurance coverage for natural disasters, by creating a standardized set of guidelines and requirements for insurance companies. This would help ensure that homeowners are able to quickly and easily obtain the coverage they need to protect their property. Furthermore, the Homeowners' Defense Act includes provisions to incentivize homeowners to take proactive measures to protect their property from natural disasters, such as by implementing building codes and other safety measures. This would not only help reduce the risk of damage to homes, but also lower the overall cost of insurance coverage for homeowners. Overall, the Homeowners' Defense Act of 2023 seeks to provide homeowners with the support and resources they need to protect their property from natural disasters, and to ensure that they are able to quickly recover in the event of a catastrophe.
Congressional Summary of HR 3997
Homeowners' Defense Act of 2023
This bill allows the Department of the Treasury to guarantee the debt issued by an eligible state catastrophe insurance program, with limitations on the total amount of debt guaranteed. To qualify, a state program must (1) be established and authorized by state law as an insurance program or a reinsurance program designed to support the private insurance market, and (2) offer residential property insurance coverage for losses arising from any personal residential line of insurance. Treasury must pay the portion of the principal and interest on guaranteed debt due for payment if the state program has insufficient funds.
Treasury must also make reinsurance coverage available to eligible state programs. (Reinsurance protects insurers from large losses.) The bill also establishes the Federal Natural Catastrophe Reinsurance Fund, funded in part by the sale of reinsurance contracts, to pay out eligible losses.
The bill also establishes the National Catastrophe Risk Consortium which must maintain an inventory of catastrophic risk obligations held by natural catastrophe insurance, among other functions.
The Department of Housing and Urban Development must provide grants to entities (such as states) for the purpose of preventing and mitigating losses from natural catastrophes.
The Government Accountability Office must report on risk-based rate pricing and state insurance program rates.
