Task force finalizes flood insurance access report

The Pennsylvania Insurance Commissioner, on behalf of the Flood Insurance Premium Assistance Task Force (Task Force), has presented Governor Josh Shapiro and the General Assembly with the Flood Insurance Premium Assistance Task Force Final Report, which 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.

Governor Shapiro signed HB 735 into law as Act 22 in November 2023 after it passed both the House and Senate with bipartisan support, establishing the Task Force and directing it to study flood insurance issues and make recommendations to help improve affordability and expand access to flood insurance coverage for Pennsylvania communities. Act 22 charged the Task Force to deliver a report with its recommendations by July 1, 2024.

"As we prepared this report, we heard firsthand from Pennsylvanians about their lived experiences and suggestions on obtaining and paying for flood insurance, giving us the chance to develop a report with concrete solutions that are guided by the people of Pennsylvania," said Pennsylvania Insurance Commissioner and Task Force Chair Michael Humphreys. "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 towards what should be continued dialogue around how we best prepare for and mitigate against flood risk to make flood insurance more affordable for Pennsylvanians.

The report's recommendations encompass key pillars of affordability, risk mitigation, incentives, and education and outreach. The Task Force is recommending:

Establishing an Office of Community Rating System Assistance (CRSA) and Expand Grant Funding within the Pennsylvania Emergency Management Agency (PEMA);

Improving Disclosures During the Home-buying Process;

Incorporating Continuing Education Credits Across Professional Roles;

Enhancing Education and Outreach;

Incentivizing Home Mitigation through Tax Credits;

Enhancing Coverage for Water Damage;

Incorporating Flood Resiliency into Building Codes;

Proposing a Pennsylvania Flood Insurance Relief Act; and

Studying Further Innovative Solutions.

"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."

The Task Force's 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.

As outlined in Act 22, recommendations in the report needed to address the following:

Potential programs that provide premium discounts;

Potential programs that create incentives for local governments to undertake or continue flood mitigation efforts;

The implementation of necessary changes in statutes or practices relating to the administration of flood insurance;

How to educate residents about the risk of flooding and ways to mitigate flood occurrences;

Steps that should be taken to inform residents about options available when purchasing flood insurance; and

How to increase the number of people that purchase flood insurance.

"Flooding poses a significant risk to communities across our Commonwealth, and it is crucial that we take proactive steps to mitigate this threat," said State Senator Steve Santarsiero. "The Task Force has put forward actionable recommendations to help safeguard Pennsylvanians and ensure that flood insurance is more accessible and affordable. I am grateful for the extensive stakeholder engagement and the expertise provided throughout this process. Our collaborative efforts have resulted in a set of recommendations that will help protect our communities from future flood disasters and promote resilience across Pennsylvania."

"The many destructive weather events experienced across Pennsylvania over the past decade present difficult challenges for communities and families. 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," said State Senator Lisa Baker. "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."

"Thank you to Governor Shapiro for traveling to Yardley to sign Act 22 into law and to the members and all the participants in the task force created by Act 22 for their work in identifying concrete measures to expand access to flood insurance and to make it more affordable," said State Rep. Perry Warren. "This report identifies next steps, and I look forward to supporting legislation to implement the recommendations of the task force."

"I enjoyed working in a bi-partisan manner on the flood insurance task force. We were able to identify the many challenges and develop recommendations to bring much needed updates to our current flood insurance policies," said State Rep. David Zimmerman.

The Flood Insurance Task Force page on PID's website contains information about the Task Force's meetings, presentations, additional materials and the Final Report.

PID also reminds Pennsylvanians that a standard homeowner or renters' policy usually does not cover damages resulting from a flood. While flood insurance was traditionally only available to homeowners or renters through the National Flood Insurance Program (NFIP), today there are more options for consumers to consider. Flood insurance that are available through private insurers, including surplus lines insurers, and can be purchased through licensed property and casualty insurance agents in Pennsylvania to cover almost any building and its contents, including rental property and condominiums. Renters can buy protection for their belongings as well.

Pennsylvanians impacted by flooding should visit PID's website for resources that can help guide property owners through filing insurance claims, and tips to avoid repair scams. More information on the NFIP and private flood insurance is available on the Insurance Department's one-stop Flood Insurance page, and more information on guidance following a severe weather event can be found on the Disaster Recovery resource page.

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