I 
114TH CONGRESS 
2D SESSION 
H. R. 6434 
To provide for more transparent and appropriate reimbursement of insurers 
participating in the Write Your Own program under the National Flood 
Insurance Program, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
DECEMBER 5, 2016 
Mr. PALLONE (for himself, Mr. PASCRELL, and Mr. PAYNE) introduced the 
following bill; which was referred to the Committee on Financial Services 
A BILL 
To provide for more transparent and appropriate reimburse-
ment of insurers participating in the Write Your Own 
program under the National Flood Insurance Program, 
and for other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Flood Insurance Reim-
bursement Standards Transparency Cap Profits Act of 
2016’’ or the ‘‘FIRST Cap Profits Act of 2016’’. 
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SEC. 2. IMPLEMENTATION OF OVERSIGHT AND EXPENSE 
REIMBURSEMENT PROVISIONS FOR WRITE 
YOUR OWN INSURERS. 
(a) METHODOLOGY AND RULEMAKING.—Not later 
than the expiration of the 12-month period beginning on 
the date of the enactment of this Act, the Administrator 
of the Federal Emergency Management Agency (in this 
Act referred to as the ‘‘Administrator’’) and each property 
and casualty insurance company participating in the Write 
Your Own program (as such term is defined in section 
100202 of the Biggert-Waters Flood Insurance Reform 
Act of 2012 (42 U.S.C. 4004)), as applicable, shall comply 
with and complete all requirements under subsections (a) 
through (e) of section 100224 of the Biggert-Waters 
Flood Insurance Reform Act of 2012 (42 U.S.C. 4081 
note), as amended by section 3(a) of this Act, including 
issuing a final rule under subsection (d) of such section 
100224, notwithstanding any period of time specified in 
such section 100224. The Administrator shall take such 
actions as may be necessary to ensure such compliance. 
(b) GAO REPORT.—Paragraph (1) of section 
100224(f) of the Biggert-Waters Flood Insurance Reform 
Act of 2012 (42 U.S.C. 4081 note) is amended by insert-
ing ‘‘of this section and section 2(a) of the Flood Insur-
ance Reimbursement Standards Transparency Cap Profits 
Act of 2016’’ before the first comma. 
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SEC. 3. WYO REIMBURSEMENT METHODOLOGY. 
(a) LIMITATION ON REIMBURSEMENTS.—Subsection 
(b) of section 100204 of the Biggert-Waters Flood Insur-
ance Reform Act of 2012 (42 U.S.C. 4081 note) is amend-
ed by adding after and below paragraph (3) the following: 
‘‘Any such methodology developed shall provide that such 
reimbursements for any property and casualty insurer for 
selling, writing, and servicing flood insurance policies, and 
adjusting flood insurance claims, including any allowances 
for profit, shall not in any case exceed 110 percent of the 
aggregate amount of such actual expenses of the insurer.’’. 
(b) SUBMISSION OF METHODOLOGY TO CONGRESS.— 
Not later than the expiration of the 90-day period begin-
ning on the date of the enactment of this Act, the Admin-
istrator shall submit to the Congress the methodology re-
quired to be developed under section 100224(b) of the 
Biggert-Waters Flood Insurance Reform Act of 2012 (42 
U.S.C. 4081 note), as amended by subsection (a) of this 
subsection, or, if such methodology has not been com-
pleted as of the time of such submission, the methodology 
to the extent so completed and all information in the pos-
session of the Administrator regarding the development of 
such methodology. 
SEC. 4. NONCOMPLIANCE. 
(a) TIMING FOR COMPLIANCE.—If— 
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(1) upon the expiration of the 12-month period 
referred to section 2(a) of this Act, the Adminis-
trator has not issued the final rule required under 
such section 2(a), or 
(2) upon the expiration of the 90-day period re-
ferred to in section 3(b) of this Act, the Adminis-
trator has not submitted to the Congress the meth-
odology required under such section 3(b), 
subsection (b) of this section shall take effect and shall 
apply until such final rule has been issued or such method-
ology has been submitted, as the case may be. 
(b) LIMITATIONS.—During any period that this sub-
section is in effect— 
(1) the Administrator may not reimburse, or 
otherwise provide any allowance, payment, or com-
pensation for selling, writing, or servicing flood in-
surance policies, or adjusting flood insurance claims, 
including any allowance for profit, to any property 
and casualty insurance company participating in the 
Write Your Own program and shall withhold all 
amounts for such reimbursements, allowance, pay-
ments, and compensation; and 
(2) any claim under a flood insurance policy 
serviced by an insurance company participating in 
the Write Your Own program shall be adjusted and 
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serviced only by a direct servicing agent of the Fed-
eral Emergency Management Agency. 
SEC. 5. AWARD OF COSTS OF LITIGATION IN CASES OF WYO 
FRAUD. 
Section 1345 of the National Flood Insurance Act of 
1968 (42 U.S.C. 4083) is amended by adding at the end 
the following new subsection: 
‘‘(f) AWARD OF COSTS OF LITIGATION IN CASES OF 
WYO FRAUD.—If the plaintiff prevails in any civil action 
for fraud or misrepresentation by any insurance company 
occurring in the course of its participation in the Write 
Your Own program (as such term is defined in section 
100202 of the Biggert-Waters Flood Insurance Reform 
Act of 2012 (42 U.S.C. 4004)), the court shall award costs 
of litigation (including reasonable attorney and expert wit-
ness fees) to the plaintiff.’’. 
Æ 
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