I 
110TH CONGRESS 
1ST SESSION H. R. 3121 
To restore the financial solvency of the national flood insurance program 
and to provide for such program to make available multiperil coverage 
for damage resulting from windstorms and floods, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
JULY 19, 2007 
Ms. WATERS (for herself, Mr. TAYLOR, Mr. JINDAL, Mr. AL GREEN of Texas, 
and Mr. FRANK of Massachusetts) introduced the following bill; which 
was referred to the Committee on Financial Services 
A BILL 
To restore the financial solvency of the national flood insur-
ance program and to provide for such program to make 
available multiperil coverage for damage resulting from 
windstorms and floods, 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 AND TABLE OF CONTENTS. 
(a) SHORT TITLE.—This Act may be cited as the 
‘‘Flood Insurance Reform and Modernization Act of 
2007’’. 
(b) TABLE OF CONTENTS.—The table of contents for 
this Act is as follows: 
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Sec. 1. Short title and table of contents. 
Sec. 2. Findings and purposes. 
Sec. 3. Study regarding status of pre-firm properties and mandatory purchase 
requirement for natural 100-year floodplain and non-federally 
related loans. 
Sec. 4. Phase-in of actuarial rates for nonresidential properties and non-pri-
mary residences. 
Sec. 5. Exception to waiting period for effective date of policies. 
Sec. 6. Enforcement. 
Sec. 7. Multiperil coverage for flood and windstorm. 
Sec. 8. Maximum coverage limits. 
Sec. 9. Coverage for additional living expenses, basement improvements, busi-
ness interruption, and replacement cost of contents. 
Sec. 10. Notification to tenants of availability of contents insurance. 
Sec. 11. Increase in annual limitation on premium increases. 
Sec. 12. Increase in borrowing authority. 
Sec. 13. FEMA participation in State disaster claims mediation programs. 
Sec. 14. FEMA annual report on insurance program. 
Sec. 15. Flood insurance outreach grants. 
Sec. 16. Grants for direct funding of mitigation activities for individual repet-
itive claims properties. 
Sec. 17. Extension of pilot program for mitigation of severe repetitive loss prop-
erties. 
Sec. 18. Flood mitigation assistance program. 
Sec. 19. GAO study of methods to increase flood insurance program participa-
tion by low-income families. 
Sec. 20. Notice of availability of flood insurance and escrow in RESPA good 
faith estimate. 
Sec. 21. Reiteration of FEMA responsibilities under 2004 Reform Act. 
Sec. 22. Ongoing modernization of flood maps and elevation standards. 
Sec. 23. Notification and appeal of map changes; notification of establishment 
of flood elevations. 
Sec. 24. Clarification of replacement cost provisions, forms, and policy lan-
guage. 
Sec. 25. Authorization of additional FEMA staff. 
Sec. 26. Extension of deadline for filing proof of loss. 
Sec. 27. 5-year extension of program. 
SEC. 2. FINDINGS AND PURPOSES. 
(a) FINDINGS.—The Congress finds that— 
(1) flooding has been shown to occur in all 50 
States, the District of Columbia, and in all terri-
tories and possessions of the United States; 
(2) the national flood insurance program 
(NFIP) is the only affordable and reliable source of 
insurance to protect against flood losses; 
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(3) the aggregate amount of the flood insurance 
claims resulting from Hurricane Katrina, Hurricane 
Rita, and other events has exceeded the aggregate 
amount of all claims previously paid in the history 
of the national flood insurance program, requiring a 
significant increase in the program’s borrowing au-
thority; 
(4) flood insurance policyholders have a legiti-
mate expectation that they will receive fair and time-
ly compensation for losses covered under their poli-
cies; 
(5) substantial flooding has occurred, and will 
likely occur again, outside the areas designated by 
the 
Federal 
Emergency 
Management 
Agency 
(FEMA) as high-risk flood hazard areas; 
(6) properties located in low- to moderate-risk 
areas are eligible to purchase flood insurance policies 
with premiums as low as $112 a year; 
(7) about 450,000 vacation homes, second 
homes, and commercial properties are subsidized 
and are not paying actuarially sound rates for flood 
insurance; 
(8) phasing out subsidies currently extended to 
vacation homes, second homes, and commercial 
properties would result in estimated average annual 
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savings to the taxpayers of the United States and 
the 
national 
flood 
insurance 
program 
of 
$335,000,000; 
(9) the maximum coverage limits for flood in-
surance policies should be increased to reflect infla-
tion and the increased cost of housing; 
(10) significant reforms to the national flood in-
surance program required in the Bunning-Bereuter- 
Blumenauer Flood Insurance Reform Act of 2004 
have yet to be implemented; and 
(11) in addition to reforms required in the 
Bunning-Bereuter-Blumenauer Flood Insurance Re-
form Act of 2004, the national flood insurance pro-
gram requires a modernized and updated adminis-
trative model to ensure that the program is solvent 
and the people of the United States have continued 
access to flood insurance. 
(b) PURPOSES.—The purposes of this Act are— 
(1) to protect the integrity of the national flood 
insurance program by fully funding existing legal ob-
ligations expected by existing policyholders who have 
paid policy premiums in return for flood insurance 
coverage and to pay debt service on funds borrowed 
by the NFIP; 
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(2) to increase incentives for homeowners and 
communities to participate in the national flood in-
surance program and to improve oversight to ensure 
better accountability of the NFIP and FEMA; 
(3) to increase awareness of homeowners of 
flood risks and improve the quality of information 
regarding such risks provided to homeowners; and 
(4) to provide for the national flood insurance 
program to make available optional multiperil insur-
ance coverage against loss resulting from physical 
damage to or loss of real or personal property aris-
ing from any flood or windstorm. 
SEC. 3. STUDY REGARDING STATUS OF PRE-FIRM PROP-
ERTIES AND MANDATORY PURCHASE RE-
QUIREMENT FOR NATURAL 100-YEAR FLOOD-
PLAIN 
AND 
NON-FEDERALLY 
RELATED 
LOANS. 
(a) IN GENERAL.—The Comptroller General shall 
conduct a study as follows: 
(1) PRE-FIRM
PROPERTIES.—The study shall 
determine the status of the national flood insurance 
program, as of the date of the enactment of this Act, 
with respect to the provision of flood insurance cov-
erage for pre-FIRM properties (as such term is de-
fined in section 578(b) of the National Flood Insur-
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