Michigan Congresswoman Says Flood Insurance Bill Bad for Residents

A U.S. Congresswoman from Michigan wants her state to opt out of the National Flood Insurance Program, saying it’s not good for Michigan homeowners.

U.S. Representative Candice Miller (MI-10) voted against H.R. 3370, the Homeowner Flood Insurance Affordability Act, which passed the House on March 4. The bill, sponsored by Reps. Michael Grimm (R-N.Y.) and Maxine Waters (D-Calif.), passed 306-91 under a “suspension of the rules” requiring a two-thirds vote in favor.

In a statement released by her office, Rep. Miller said under the flood insurance program Michigan homeowners pay higher flood insurance premiums to subsidize plans in flood prone areas of the country.

She is urging Governor Mitch Snyder to opt Michigan out of program altogether.

“The National Flood Insurance Program is hopelessly in debt, over $25 billion, due to the fact that politics are responsible for setting rates, not actuarial cost,” Miller stated. “As a result, too many Americans across this nation are paying rates far below what actual risk would dictate in the marketplace while others, including many who I represent, are being forced to pay into a program that they do not need or want to help subsidize lower rates for other favored groups whose risk is far greater.

“In fact, since the federal flood insurance program started, homeowners in Michigan have paid multiple times more in premiums than has been paid back in claims.”

Miller compared the flood program to the Affordable Care Act, or Obamacare, saying it is a “costly, unworkable, unfair and failed program,” that shows “exactly why the federal government shouldn’t be in the insurance business.”

Miller said it would be better to “seek a state or private alternative that stops forcing Michigan homeowners to serve as ATM machines for the rest of the nation.”

The U.S. Senate passed its own version of flood insurance legislation, S. 1926, in January by a 67-32 vote. The Senate bill takes a broader swipe at the National Flood Insurance Program (NFIP) and delays most of the reforms and increases of the Biggert-Waters Flood Insurance Reform Act of 2012 for four years.

However, key senators, including Sen. Robert Menendez, (D-N.J.), the sponsor of the Senate version, said they would accept the House bill.

As of the end of September 2013, there were 25,469 flood insurance policies in force in Michigan, according to the NFIP. By comparison, there were 631,158 policies in force in Texas that year and more than 2 million in Florida.

Between Oct. 1, 2012, and Sept. 30, 2013, Michigan policyholders filed 481 flood insurance claims, NFIP data shows. That compares with 890 flood insurance claims filed by Texas policyholders and 2,284 claims filed by Florida policyholders during that same time period. In New York, 58,300 NFIP policyholders filed claims during the period. There were 194,650 flood insurance policies in force in New York as of Sept. 30, 2013.

The number of flood insurance policies in force between Oct. 1, 2012, and Sept. 30, 2013, fell in Michigan by 3 percent. New York’s policy count rose by 15 percent during that time period. In Texas the number of policies in force declined by 2 percent and in Florida the count remained the same.