June 22, 2023

Cassidy, Higgins, Pallone Rollout Bipartisan Legislation to Reform the National Flood Insurance Program

WASHINGTON – U.S. Senators Bill Cassidy, M.D. (R-LA) and Bob Menendez (D-NJ) and U.S. Representatives Clay Higgins (R-LA-03) and Frank Pallone (D-NJ-06) introduced the bipartisan and bicameral National Flood Insurance Program Reauthorization (NFIP-RE) Act of 2023. This legislation would reauthorize the program for five years – providing greater stability for homeowners, small business owners, and the real estate market as the nation continues to struggle with inflationary pressures. It will also implement a series of sweeping reforms to reduce costs, make generational investments in communities to reduce flood risk, and establish a fairer claims process for policyholders.

“Reforming the NFIP means making it affordable again,” said Dr. Cassidy. “We need to ensure families are not priced out of the program.”

President Joe Biden can stop the implementation of Risk Rating 2.0 with the stroke of his pen. He has yet to take action.

“Congress can no longer afford to punt long-term reauthorization and reform of the NFIP. It’s time to put policyholders first and addresses the longstanding systemic issues with the program that came under the national spotlight in the aftermath of Hurricane Sandy,” said Senator Menendez. “With disastrous flooding events becoming all the more common, we must work to create a more sustainable, resilient, and affordable flood insurance program that invests in prevention and mitigation efforts, and all while ensure hard-working Americans can have peace of mind in the event of a disaster.”

“Flood insurance for home and business owners in South Louisiana and across the country is a necessity that has become increasingly unaffordable for hardworking Americans,” said Representative Higgins. “Millions of homeowners rely on NFIP as the only real option for flood insurance. Reauthorization of NFIP is a necessity, and forcing Congress to address the serious problems of Risk Rating 2.0 is a priority. My office remains focused on passing a long-term reauthorization that protects affordability, improves flood plain mapping, and prioritizes pre-disaster mitigation.”

“New Jerseyans still know all too well how important a flood insurance program is. After Superstorm Sandy and Hurricane Ida devastated New Jersey communities, insurance companies have outright refused to make good on their promises to policyholders and used the fine print to deny families who lost everything,” said Representative Pallone. “For years, I’ve been warning that Risk Rating 2.0 could be used to unfairly target coastal communities while making flood insurance unaffordable for working families, and that’s exactly what I’m hearing from my constituents. FEMA’s Risk Rating 2.0 is lowering costs for some, but it’s causing thousands of households to drop coverage all together due to rate shocks. The National Flood Insurance Program must be affordable and fair – otherwise it just doesn’t work. This bill will strengthen the program so that homeowners in my district are protected from the devastating effects of flooding.” 

The NFIP-RE Act of 2023 tackles systemic problems with flood insurance, puts the program back on solid fiscal ground, and reframes the nation’s entire disaster paradigm to one that focuses more on prevention and mitigation to prevent the high cost of rebuilding after flood disasters. Over the last year, the NFIP has lost 100,000 policyholders, and according to the Associated Press, the program is estimated to lose hundreds of thousands more policyholders over the coming years due to FEMA’s new rating methodology Risk Rating 2.0, at a time when flood risk is only expected to grow. Cassidy and Menendez, along with several of their colleagues, consistently warned about the negative effects Risk Rating 2.0 would have on the stability of NFIP and how it would hurt policyholders.

The NFIP-RE Act of 2023 would:

  • Protect policyholders from exorbitant premium hikes by capping annual increases at nine percent.
  • Provide a comprehensive means-tested voucher for millions of low- and middle-income homeowners and renters if their flood insurance premium becomes prohibitively expensive.
  • Increase the maximum limit for Increased Cost of Compliance (ICC) coverage to better reflect the costs of rebuilding and implementing mitigation projects.
  • Create new oversight measures for insurance companies and vendors, and provides FEMA with greater authority to terminate contractors that have a track record of abuse.
  • Reform the claims process based on lessons learned from Superstorm Sandy and other disasters, to level the playing field for policy holders during appeal or litigation, hold FEMA accountable to strict deadlines so that homeowners get quick and fair payments, and ban aggressive legal tactics preventing homeowners from filing legitimate claims.

Cassidy and Menendez were joined by U.S. Senators John Kennedy (R-LA), Cory Booker (D-NJ), Cindy Hyde-Smith (R-MS), Kristen Gillibrand (D-NY), Chris Van Hollen (D-MD), Roger Wicker (R-MS), and Marco Rubio (R-FL) in cosponsoring the legislation. 

“By making flood insurance unaffordable, the Biden administration’s Risk Rating 2.0 is making it impossible for Louisianians to protect their biggest assets—their homes,” said Senator Kennedy. “We must make sure that the NFIP works for the people who depend on it, and this bill would do that.”

“It is critical our nation’s flood insurance program is stable and affordable so that our communities and policyholders can protect their homes and businesses and get the help they need when disaster strikes,” said Senator Booker. “This legislation takes important steps to reduce risk, invest in pre-disaster mitigation efforts, and support those in need. We must protect Americans from the devastating impacts of flooding.”

“The rollout of Risk Rating 2.0 has only served to compound the fundamental problems within the National Flood Insurance Program, which isn’t doing anyone any favors especially those who need flood insurance most.  There’s no point in having flood insurance if nobody can afford it,” said Senator Hyde-Smith. “The comprehensive reforms in this legislation deserve to be enacted so we can begin to fix the disfunction of the existing NFIP program. Taxpayers and policyholders deserve nothing less.”

“Helping our communities prepare for and recover from the devastation caused by flooding should be one of our highest priorities, especially as so many states continue to be hit with extreme weather,” said Senator Gillibrand. “The National Flood Insurance Program protects households in New York and across the country from the losses that follow major flooding, but for too many, flood insurance is becoming unaffordable. The NFIP-RE Act of 2023 will ensure that flood insurance programs are affordable, transparent, and accountable for New Yorkers and others across the country.”

“Like the rest of the country, communities across Maryland are feeling the impacts of flooding caused by more frequent and extreme weather events. That’s why we need to reform this program – to ensure families and businesses across the state have access to affordable coverage and our flood maps are up-to-date,” said Senator Van Hollen.

“The National Flood Insurance Program is a lifeline for many Mississippi communities at risk of flooding, and it is important for the program to be renewed,” said Senator Wicker. “This legislation will reauthorize the program while incorporating much-needed reforms to help address the skyrocketing costs of premiums and make the program work better for policyholders and the taxpayer.”

“Flood insurance is a necessity in Florida, and getting the National Flood Insurance Program (NFIP) on track to fiscal sustainability is critical to ensuring millions of policyholders maintain coverage. This legislation would provide a five-year reauthorization and create stability for millions of policyholders across the state and nationwide,” said Senator Rubio.

The National Association of Counties, American Policyholder Association, New Orleans Chamber of Commerce, Baton Rouge Area Chamber and New Jersey Organizing Project support the NFIP-RE Act of 2023.

“Homeowners in the New Orleans area have seen their flood insurance rates double and even triple in the past few years, with more rate hikes to come. We need bold action by Congress to stop this, and Senator Cassidy’s legislation is a great start. Together, we can keep New Orleans affordable for our families and businesses,” said New Orleans Chamber of Commerce President and CEO Sandra Lindquist.

“The Great Flood of 2016 and other weather events demonstrate the need for affordable flood insurance in Louisiana’s Capital Region. Senator Cassidy’s legislation recognizes that, and takes steps to boost participation, correct flood maps, incentivize mitigation, and protect homeowners against Risk Rating 2.0. We appreciate his thoughtful leadership on this issue,” said Mr. Adam Knapp, President and CEO, Baton Rouge Area Chamber

“Home builders in the Capital Region won’t be able to build and sell homes if people can’t buy them. So we need flood insurance policies that are transparent, accountable, and most importantly, affordable. We appreciate Senator Bill Cassidy working to reform the National Flood Insurance Programs, so all this is possible,” said Home Builders Association of Greater Baton Rouge President and CEO Karen Zito.

“This legislation will benefit both policyholders, and the program itself, at many levels, including, but not limited to: forbearing NFIP interest payments, reinvesting up to $620 million of annual savings into flood mitigation, and authorizing a means-tested affordability program,” said Greater New Orleans, Inc. President and CEO Michael Hecht. “The Coalition for Sustainable Flood Insurance (CSFI) appreciates Senators Cassidy and Menendez’s continued championship of NFIP and commends all Members of Congress who are responding to their constituents’ need for accessible, affordable, and transparent flood insurance.”

“The bipartisan National Flood Insurance Program Reauthorization Act would provide much-needed, long-term certainty and key reforms that would benefit counties and our residents,” said National Association of Counties Executive Director Matthew Chase. “Reauthorizing the program for five years would ensure continuous operation and greater stability for policyholders. Additionally, we appreciate the caps placed on annual premium increases, affordability provisions for low- and middle-income policyholders, and increased investments in flood mitigation. The bill would also increase transparency on FEMA’s new risk rating system, known as Risk Rating 2.0, and freeze interest payments on the NFIP debt, helping to make the program solvent. Counties thank Senators Menendez and Cassidy for their leadership, and we look forward to working with our bipartisan congressional partners to secure passage of this legislation.”


Cassidy has long been a leader in the fight to increase flood protections for Louisiana residents and Americans all across the country. Last month, Cassidy participated in a roundtable hosted by Greater New Orleans (GNO), Inc. and the Coalition for Sustainable Flood Insurance on addressing Risk Rating 2.0 and making flood insurance affordable.

Earlier this year, Cassidy delivered a speech on the U.S. Senate floor demanding the Biden administration halt massive hikes to National Flood Insurance Program premiums caused by Risk Rating 2.0.

In February 2022, FEMA publicly acknowledged an internal study finding that the implementation of Risk Rating 2.0 to the National Flood Insurance Program (NFIP) could cause 20% of policyholders to drop out of the program due to skyrocketing premiums. Learn more here.