not less than the estimated premium rates for such 
coverage determined in accordance with section 
1307(a)(1).’’. 
(d) OPTIONAL COVERAGE FOR LOSS OF USE OF PER-
SONAL RESIDENCE AND BUSINESS INTERRUPTION.—Sub-
section (b) of section 1306 of the National Flood Insur-
ance Act of 1968 (42 U.S.C. 4013(b)), as amended by 
the preceding provisions of this section, is further amend-
ed by inserting after paragraph (4) the following new 
paragraphs: 
‘‘(5) the Administrator may provide that, in the 
case of any residential property, each renewal or new 
contract for flood insurance coverage may provide 
not more than $5,000 aggregate liability per dwell-
ing unit for any necessary increases in living ex-
penses incurred by the insured when losses from a 
flood make the residence unfit to live in, except 
that— 
‘‘(A) purchase of such coverage shall be at 
the option of the insured; 
‘‘(B) any such coverage shall be made 
available only at chargeable rates that are not 
less than the estimated premium rates for such 
coverage determined in accordance with section 
1307(a)(1); and 
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‘‘(C) the Administrator may make such 
coverage available only if the Administrator 
makes a determination and causes notice of 
such determination to be published in the Fed-
eral Register that— 
‘‘(i) a competitive private insurance 
market for such coverage does not exist; 
and 
‘‘(ii) the national flood insurance pro-
gram has the capacity to make such cov-
erage available without borrowing funds 
from the Secretary of the Treasury under 
section 1309 or otherwise; 
‘‘(6) the Administrator may provide that, in the 
case of any commercial property or other residential 
property, including multifamily rental property, cov-
erage for losses resulting from any partial or total 
interruption of the insured’s business caused by 
damage to, or loss of, such property from a flood 
may be made available to every insured upon re-
newal and every applicant, up to a total amount of 
$20,000 per property, except that— 
‘‘(A) purchase of such coverage shall be at 
the option of the insured; 
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‘‘(B) any such coverage shall be made 
available only at chargeable rates that are not 
less than the estimated premium rates for such 
coverage determined in accordance with section 
1307(a)(1); and 
‘‘(C) the Administrator may make such 
coverage available only if the Administrator 
makes a determination and causes notice of 
such determination to be published in the Fed-
eral Register that— 
‘‘(i) a competitive private insurance 
market for such coverage does not exist; 
and 
‘‘(ii) the national flood insurance pro-
gram has the capacity to make such cov-
erage available without borrowing funds 
from the Secretary of the Treasury under 
section 1309 or otherwise;’’. 
(e) PAYMENT OF PREMIUMS IN INSTALLMENTS FOR 
RESIDENTIAL PROPERTIES.—Section 1306 of the Na-
tional Flood Insurance Act of 1968 (42 U.S.C. 4013) is 
amended by adding at the end the following new sub-
section: 
‘‘(d) PAYMENT OF PREMIUMS IN INSTALLMENTS FOR 
RESIDENTIAL PROPERTIES.— 
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‘‘(1) AUTHORITY.—In addition to any other 
terms and conditions under subsection (a), such reg-
ulations shall provide that, in the case of any resi-
dential property, premiums for flood insurance cov-
erage made available under this title for such prop-
erty may be paid in installments. 
‘‘(2) LIMITATIONS.—In implementing the au-
thority under paragraph (1), the Administrator may 
establish increased chargeable premium rates and 
surcharges, and deny coverage and establish such 
other sanctions, as the Administrator considers nec-
essary to ensure that insureds purchase, pay for, 
and maintain coverage for the full term of a contract 
for flood insurance coverage or to prevent insureds 
from purchasing coverage only for periods during a 
year when risk of flooding is comparatively higher or 
canceling coverage for periods when such risk is 
comparatively lower.’’. 
(f) EFFECTIVE DATE OF POLICIES COVERING PROP-
ERTIES AFFECTED
BY FLOODS
IN PROGRESS.—Para-
graph (1) of section 1306(c) of the National Flood Insur-
ance Act of 1968 (42 U.S.C. 4013(c)) is amended by add-
ing after the period at the end the following: ‘‘With respect 
to any flood that has commenced or is in progress before 
the expiration of such 30-day period, such flood insurance 
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coverage for a property shall take effect upon the expira-
tion of such 30-day period and shall cover damage to such 
property occurring after the expiration of such period that 
results from such flood, but only if the property has not 
suffered damage or loss as a result of such flood before 
the expiration of such 30-day period.’’. 
SEC. 345. REFORMS OF PREMIUM RATES. 
(a) INCREASE IN ANNUAL LIMITATION ON PREMIUM 
INCREASES.—Section 1308(e) of the National Flood In-
surance Act of 1968 (42 U.S.C. 4015(e)) is amended by 
striking ‘‘10 percent’’ and inserting ‘‘20 percent’’. 
(b) PHASE-IN OF RATES FOR CERTAIN PROPERTIES 
IN NEWLY MAPPED AREAS.— 
(1) IN
GENERAL.—Section 1308 of the Na-
tional Flood Insurance Act of 1968 (42 U.S.C. 
4015) is amended— 
(A) in subsection (a), in the matter pre-
ceding paragraph (1), by inserting ‘‘or notice’’ 
after ‘‘prescribe by regulation’’; 
(B) in subsection (c), by inserting ‘‘and 
subsection (g)’’ before the first comma; and 
(C) by adding at the end the following new 
subsection: 
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