1. Short title
This Act may be cited as the “Saving Homeowners from Onerous Rate Escalations Act of 2013” or the “SHORE Act of 2013”.
Saving Homeowners from Onerous Rate Escalations Act of 2013
A BILL
To extend the phase-in of actuarial rates for flood insurance for certain properties under the Biggert-Waters Flood Insurance Reform Act of 2012.
2. Extension of phase-in of actuarial rates for flood insurance for certain properties
New policies and lapsed policies— Section 1307(g) of the National Flood Insurance Act of 1968 (42 U.S.C. 4014(g)) is amended—
in paragraph (4)—
in subparagraph (B), by redesignating clauses (i) and (ii) as subclauses (I) and (II), respectively, and adjusting the margins accordingly; and
by redesignating subparagraphs (A) and (B) as clauses (i) and (ii), respectively, and adjusting the margins accordingly;
by redesignating paragraphs (1) through (4) as subparagraphs (A) through (D), respectively, and adjusting the margins accordingly;
in the matter preceding subparagraph (A), as redesignated, by striking “The Administrator” and inserting the following:
“(1) In general—The Administrator”
by adding at the end the following:
“(2) Phase-in of actuarial rates
“(A) In general—Any increase in the risk premium rate charged for flood insurance for a property or policy described in subparagraph (A), (B), or (C) of paragraph (1) that is a result of the prohibition set forth under such paragraph shall be phased in over an 8-year period at the rate of—
“(i) 5 percent for each of the first 5 years after the applicable effective date established under subparagraph (B) of this paragraph; and
“(ii) 25 percent for each of the subsequent 3 years.
“(B) Effective date of phase-in—The applicable effective date under this subparagraph is the later of—
“(i) the date of enactment of the SHORE Act of 2013; or
“(ii) the date on which—
“(I) a property described in paragraph (1)(A) becomes insured by the national flood insurance program;
“(II) a property described in paragraph (1)(B) is purchased; or
“(III) coverage for a policy described in paragraph (1)(C) is renewed.”
Certain other properties— Section 1308(e)(2) of the National Flood Insurance Act of 1968 (42 U.S.C. 4015(e)(2)) is amended by striking “by 25 percent each year, until” and inserting the following: “by 5 percent each year for 5 years and by 25 percent each year thereafter, until”.
Premium adjustments To reflect current risk of flood—
In general— Section 1308(h) of the National Flood Insurance Act of 1968 (42 U.S.C. 4015(h)) is amended—
in the second sentence, by striking “over a 5-year period, at the rate of 20 percent for each year following such effective date.” and inserting the following: “over a 10-year period, at the rate of 5 percent for each of the first 5 years after such effective date and 15 percent for each of the 5 years thereafter.”; and
in the third sentence, by striking “over a 5-year period, at the rate of 20 percent for each year following the effective date of such issuance, revision, updating, or change.” and inserting the following: “over a 10-year period, at the rate of 5 percent for each of the first 5 years following the effective date of such issuance, revision, updating, or change, and 15 percent for each of the 5 years thereafter.”.
Applicability— For purposes of determining the amounts and schedule for phasing in any increase in the risk premium rate charged for flood insurance under the National Flood Insurance Program under section 1308(h) of the National Flood Insurance Act of 1968 (42 U.S.C. 4015(h)), as amended by paragraph (1), based on the issuance, revision, updating, or other change with respect to a flood insurance map that took effect during the period beginning on July 6, 2012 and ending on the date of enactment of this Act, the effective date of the issuance, revision, updating, or other change shall be deemed to be the date of enactment of this Act.