Flood Insurance Reform and Modernization Act of 2006

The Flood Insurance Reform and Modernization Act of 2006 (H.R. 4973) proposes several updates to the National Flood Insurance Program (NFIP) to improve its financial stability and expand coverage options for policyholders. The bill would increase the maximum coverage limits for homes and businesses while allowing for new types of insurance, such as coverage for basement improvements and additional living expenses incurred during a displacement. To address the program's debt, the bill would phase out premium subsidies for non-primary residences and certain older commercial properties, while also increasing the limit on how much annual premiums can rise.

For everyday citizens, this legislation would mean more robust insurance protection but potentially higher costs for owners of vacation homes or older business properties. It also aims to make the program more user-friendly by shortening the waiting period for new policies from 30 days to 15 days and establishing a formal appeals process for policyholders who disagree with FEMA’s decisions on their claims. Additionally, the bill mandates updated flood maps and a national inventory of levees to provide homeowners with more accurate information about their actual flood risk.