HR 3121 RFS
lated lending institution or enterprise for a cal-
endar year if, in any three (or more) of the five 
calendar years immediately preceding such cal-
endar year, the total amount of penalties as-
sessed under this subsection against such lend-
ing institution or enterprise was $1,000,000’’; 
and 
(2) in paragraph (6), by adding after the period 
at the end the following: ‘‘No penalty may be im-
posed under this subsection on a regulated lending 
institution or enterprise that has made a good faith 
effort to comply with the requirements of the provi-
sions referred to in paragraph (2) or for any non- 
material violation of such requirements.’’. 
SEC. 7. MULTIPERIL COVERAGE FOR FLOOD AND WIND-
STORM. 
(a) IN GENERAL.—Section 1304 of the National 
Flood Insurance Act of 1968 (42 U.S.C. 4011) is amend-
ed— 
(1) by redesignating subsection (c) as sub-
section (d); and 
(2) by inserting after subsection (b) the fol-
lowing new subsection: 
‘‘(c) MULTIPERIL COVERAGE FOR DAMAGE FROM 
FLOOD OR WINDSTORM.— 
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‘‘(1) IN GENERAL.—Subject to paragraph (8), 
the national flood insurance program established 
pursuant to subsection (a) shall enable the purchase 
of optional insurance against loss resulting from 
physical damage to or loss of real property or per-
sonal property related thereto located in the United 
States arising from any flood or windstorm, subject 
to the limitations in this subsection and section 
1306(b). 
‘‘(2) COMMUNITY
PARTICIPATION
REQUIRE-
MENT.—Multiperil coverage pursuant to this sub-
section may not be provided in any area (or subdivi-
sion thereof) unless an appropriate public body shall 
have adopted adequate mitigation measures (with ef-
fective enforcement provisions) which the Director 
finds are consistent with the criteria for construction 
described in the International Code Council building 
codes relating to wind mitigation. 
‘‘(3) PROHIBITION AGAINST DUPLICATIVE COV-
ERAGE.—Multiperil coverage pursuant to this sub-
section may not be provided with respect to any 
structure (or the personal property related thereto) 
for any period during which such structure is cov-
ered, at any time, by flood insurance coverage made 
available under this title. 
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‘‘(4) NATURE OF COVERAGE.—Multiperil cov-
erage pursuant to this subsection shall— 
‘‘(A) cover losses only from physical dam-
age resulting from flooding or windstorm; and 
‘‘(B) provide for approval and payment of 
claims under such coverage upon proof that 
such loss must have resulted from either wind-
storm or flooding, but shall not require for ap-
proval and payment of a claim that the specific 
cause of the loss, whether windstorm or flood-
ing, be distinguished or identified. 
‘‘(5) ACTUARIAL
RATES.—Multiperil coverage 
pursuant to this subsection shall be made available 
for purchase for a property only at chargeable risk 
premium rates that, based on consideration of the 
risks involved and accepted actuarial principles, and 
including operating costs and allowance and admin-
istrative expenses, are required in order to make 
such coverage available on an actuarial basis for the 
type and class of properties covered. 
‘‘(6) TERMS
OF
COVERAGE.—The Director 
shall, after consultation with persons and entities re-
ferred to in section 1306(a), provide by regulation 
for the general terms and conditions of insurability 
which shall be applicable to properties eligible for 
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multiperil coverage under this subsection, subject to 
the provisions of this subsection, including— 
‘‘(A) the types, classes, and locations of 
any such properties which shall be eligible for 
such coverage, which shall include residential 
and nonresidential properties; 
‘‘(B) subject to paragraph (7), the nature 
and limits of loss or damage in any areas (or 
subdivisions thereof) which may be covered by 
such coverage; 
‘‘(C) the classification, limitation, and re-
jection of any risks which may be advisable; 
‘‘(D) appropriate minimum premiums; 
‘‘(E) appropriate loss deductibles; and 
‘‘(F) any other terms and conditions relat-
ing to insurance coverage or exclusion that may 
be necessary to carry out this subsection. 
‘‘(7) LIMITATIONS
ON
AMOUNT
OF
COV-
ERAGE.—The regulations issued pursuant to para-
graph (6) shall provide that the aggregate liability 
under multiperil coverage made available under this 
subsection shall not exceed the lesser of the replace-
ment cost for covered losses or the following 
amounts, as applicable: 
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‘‘(A) RESIDENTIAL STRUCTURES.—In the 
case of residential properties, which shall in-
clude structures containing multiple dwelling 
units that are made available for occupancy by 
rental (notwithstanding any treatment or classi-
fication of such properties for purposes of sec-
tion 1306(b))— 
‘‘(i) for any single-family dwelling, 
$500,000; 
‘‘(ii) for any structure containing 
more than one dwelling unit, $500,000 for 
each separate dwelling unit in the struc-
ture, which limit, in the case of such a 
structure 
containing 
multiple 
dwelling 
units that are made available for occu-
pancy by rental, shall be applied so as to 
enable any insured or applicant for insur-
ance to receive coverage for the structure 
up to a total amount that is equal to the 
product of the total number of such rental 
dwelling units in such property and the 
maximum coverage limit per dwelling unit 
specified in this clause; and 
‘‘(iii) $150,000 per dwelling unit 
for— 
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‘‘(I) any contents related to such 
unit; and 
‘‘(II) any necessary increases in 
living expenses incurred by the in-
sured when losses from flooding or 
windstorm make the residence unfit to 
live in. 
‘‘(B) NONRESIDENTIAL
PROPERTIES.—In 
the case of nonresidential properties (including 
church properties)— 
‘‘(i) $1,000,000 for any single struc-
ture; and 
‘‘(ii) $750,000 for— 
‘‘(I) any contents related to such 
structure; and 
‘‘(II) in the case of any nonresi-
dential property that is a business 
property, any losses resulting from 
any partial or total interruption of the 
insured’s business caused by damage 
to, or loss of, such property from 
flooding or windstorm, except that for 
purposes of such coverage, losses shall 
be determined based on the profits the 
covered business would have earned, 
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based on previous financial records, 
had the flood or windstorm not oc-
curred. 
‘‘(8) REQUIREMENT TO CEASE OFFERING COV-
ERAGE IF BORROWING TO PAY CLAIMS.—If at any 
time the Director utilizes the borrowing authority 
under section 1309(a) for the purpose of obtaining 
amounts to pay claims under multiperil coverage 
made available under this subsection, the Director 
may not, during the period beginning upon the ini-
tial such use of such borrowing authority and ending 
upon repayment to the Secretary of the Treasury of 
the full amount of all outstanding notes and obliga-
tions issued by the Director for such purpose, to-
gether with all interest owed on such notes and obli-
gations, enter into any new policy, or renew any ex-
isting policy, for coverage made available under this 
subsection. 
‘‘(9) EFFECTIVE DATE.—This subsection shall 
take effect on, and shall apply beginning on, June 
30, 2008.’’. 
(b) PROHIBITION
AGAINST
DUPLICATIVE
COV-
ERAGE.—The National Flood Insurance Act of 1968 is 
amended by inserting after section 1313 (42 U.S.C. 4020) 
the following new section: 
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