Pennsylvania flood insurance task force releases final report

A state task force on flood insurance has issued a final report with recommendations for making flood insurance more accessible and affordable.

The Flood Insurance Premium Assistance Task Force report includes recommendations designed to improve the affordability and accessibility of flood insurance, bolster flood resiliency, increase flood risk mitigation and protect Pennsylvanians from incurring flood damage that often results in thousands of dollars of uncovered losses.

On July 1, Pennsylvania Insurance Commissioner Michael Humphreys presented the report to the General Assembly and Gov. Josh Shapiro, who signed the law establishing the task force Nov. 1 after it passed both the House and Senate with bipartisan support.

“The Task Force believes these recommendations will enable the Commonwealth to effectively tackle challenges concerning flood risk throughout Pennsylvania, and this report represents a great first step toward what should be continued dialogue around how we best prepare for and mitigate against flood risk to make flood insurance more affordable for Pennsylvanians,” said Humphries, who chaired the task force.

“Pennsylvania is one of the most flood-prone states in the nation, and recovery is often a years-long effort,” said PEMA Director Randy Padfield. “Any steps that we can take to promote flood mitigation activities and assist homeowners and renters with obtaining affordable flood insurance will hasten recovery efforts and benefit our communities and our citizens for years to come.”

Task force recommendations

Some task force recommendations include:

* Enhancing flood insurance education and outreach.

* Enacting legislation to provide tax credits or deductions for costs incurred by homeowners for making repairs to make their homes more flood-resistant or adding other mitigation measures (such as moving appliances) that better protect it from flood damage.

* Incorporating a minimum of two hours of continuing education courses for insurance producers and real estate agents and a minimum of one hour for mortgage lenders that specifically targets flood risk and insurance.

* Enhancing coverage for water damage.

* Incorporating flood resiliency into building codes.

* Proposing a Pennsylvania Flood Insurance Relief Act.

* Expanding grant funding within PEMA.

Community ratings, homebuyer protections

The task force also recommends establishing an Office of Community Rating System Assistance. The Community Rating System is a voluntary incentive program that recognizes and encourages community floodplain management practices that exceed the minimum requirements of the National Flood Insurance Program.

In CRS communities, flood insurance premium rates are discounted to reflect the reduced flood risk resulting from the community’s efforts to reduce and avoid flood damage. Several presenters at task force meetings expressed frustration with the complexity, length of time and extensive resources necessary to become a CRS community.

Currently, there are only 1,500 CRS communities nationwide and less than 30 in Pennsylvania, including Wilkes-Barre, which receives a 20% discount; West Pittston, which receives a 15% discount; Kingston and Hanover Twp., which receive 10% discounts; and Kingston Twp., which has not yet qualified for a discount. There are no CRS communities in Schuylkill and Lackawanna counties, according to a list maintained by the Federal Emergency Management Agency.

A final task force recommendation is improving required disclosures during the home-buying process.

Pennsylvania does not require disclosing whether a property must have flood insurance coverage in order to obtain a mortgage. And even though state law requires a seller to disclose any past or present flooding, a seller may not know if the property has ever experienced a flooding event. So, a potential buyer may be unaware of the necessity for flood insurance until later in the purchase process, when a mortgage company informs them.

The recommendations are informed by information gathered at five public meetings held over the last six months that included a public comment period, agency collaboration, external stakeholder engagement, and discussions and presentations from experts in the field.

Lawmaker support

“The many destructive weather events experienced across Pennsylvania over the past decade present difficult challenges for communities and families," said state Sen. Lisa Baker, R-20, Lehman Twp. "The frequency of high damage events and the rising costs of recovery efforts are roiling insurance markets. In other states, we have seen insurance companies pull out, restrict coverage and raise premiums beyond the ability of many households and small businesses to pay."

"This is a crucial juncture for us to consider some fundamental changes before our situation deteriorates into crisis. There are broad questions about flood protections, mitigation measures, and financial coverage that require practical and effective answers. This task force was a good avenue for giving all sides the chance to participate, raising the discussion above partisan or philosophical considerations,” Baker said.

State Rep. Perry Warren, D-31, Newtown, thanked Shapiro and the task force for "identifying concrete measures to expand access to flood insurance and to make it more affordable." He said the report "identifies next steps" for the Legislature, "and I look forward to supporting legislation to implement the recommendations of the task force.”

The Flood Insurance Task Force page (https://bit.ly/fitaskforce) on PID’s website contains information about the Task Force’s meetings, presentations, additional materials and the final report.

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