IB 
Union Calendar No. 211 
110TH CONGRESS 
1ST SESSION H. R. 3121 
[Report No. 110–340] 
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 
SEPTEMBER 24, 2007 
Additional sponsors: Ms. KILPATRICK, Mrs. CHRISTENSEN, Mr. CLEAVER, Mr. 
HONDA, Mr. PATRICK MURPHY of Pennsylvania, Mr. PICKERING, Mr. 
BACA, Mr. MELANCON, and Mr. THOMPSON of Mississippi 
SEPTEMBER 24, 2007 
Reported with an amendment, committed to the Committee of the Whole 
House on the State of the Union, and ordered to be printed 
[Strike out all after the enacting clause and insert the part printed in italic] 
[For text of introduced bill, see copy of bill as introduced on July 19, 2007] 
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. 
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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: 
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 re-
quirement for natural 100-year floodplain and non-federally re-
lated loans. 
Sec. 4. Phase-in of actuarial rates for nonresidential properties and non-primary 
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, business 
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. 
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 participation 
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 language. 
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. 28. Report on inclusion of building codes in floodplain management criteria. 
Sec. 29. Study of economic effects of charging actuarially-based premium rates 
for pre-firm structures. 
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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 territories 
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; 
(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; 
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(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 prop-
erties would result in estimated average annual sav-
ings to the taxpayers of the United States and the na-
tional flood insurance program of $335,000,000; 
(9) the maximum coverage limits for flood insur-
ance policies should be increased to reflect inflation 
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 administra-
tive 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-
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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; 
(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 regard-
ing 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 arising 
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 con-
duct a study as follows: 
(1) PRE-FIRM PROPERTIES.—The study shall de-
termine the status of the national flood insurance pro-
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gram, as of the date of the enactment of this Act, with 
respect to the provision of flood insurance coverage for 
pre-FIRM properties (as such term is defined in sec-
tion 578(b) of the National Flood Insurance Reform 
Act of 1994 (42 U.S.C. 4014 note)), which shall in-
clude determinations of— 
(A) the number of pre-FIRM properties for 
which coverage is provided and the extent of such 
coverage; 
(B) the cost of providing coverage for such 
pre-FIRM properties to the national flood insur-
ance program; 
(C) the anticipated rate at which such pre- 
FIRM properties will cease to be covered under 
the program; and 
(D) the effects that implementation of the 
Bunning-Bereuter-Blumenauer Flood Insurance 
Reform Act of 2004 will have on the national 
flood insurance program generally and on cov-
erage of pre-FIRM properties under the pro-
gram. 
(2) MANDATORY PURCHASE REQUIREMENT FOR 
NATURAL 100-YEAR FLOODPLAIN.—The study shall as-
sess the impact, effectiveness, and feasibility of 
amending the provisions of the Flood Disaster Protec-
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tion Act of 1973 regarding the properties that are 
subject to the mandatory flood insurance coverage 
purchase requirements under such Act to extend such 
requirements to properties located in any area that 
would be designated as an area having special flood 
hazards but for the existence of a structural flood pro-
tection system, and shall determine— 
(A) the regulatory, financial and economic 
impacts of extending such mandatory purchase 
requirements on the costs of homeownership, the 
actuarial soundness of the national flood insur-
ance program, the Federal Emergency Manage-
ment Agency, local communities, insurance com-
panies, and local land use; 
(B) the effectiveness of extending such man-
datory purchase requirements in protecting 
homeowners from financial loss and in pro-
tecting the financial soundness of the national 
flood insurance program; and 
(C) any impact on lenders of complying 
with or enforcing such extended mandatory re-
quirements. 
(3) MANDATORY PURCHASE REQUIREMENT FOR 
NON-FEDERALLY RELATED LOANS.—The study shall 
assess the impact, effectiveness, and feasibility of, and 
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basis under the Constitution of the United States for, 
amending the provisions of the Flood Disaster Protec-
tion Act of 1973 regarding the properties that are 
subject to the mandatory flood insurance coverage 
purchase requirements under such Act to extend such 
requirements to any property that is located in any 
area having special flood hazards and which secures 
the repayment of a loan that is not described in para-
graph (1), (2), or (3) of section 102(b) of such Act, 
and shall determine how best to administer and en-
force such a requirement, taking into consideration 
other insurance purchase requirements under Federal 
and State law. 
(b) REPORT.—The Comptroller General shall submit 
a report to the Congress regarding the results and conclu-
sions of the study under this subsection not later than the 
expiration of the 6-month period beginning on the date of 
the enactment of this Act. 
SEC. 4. PHASE-IN OF ACTUARIAL RATES FOR NONRESIDEN-
TIAL PROPERTIES AND NON-PRIMARY RESI-
DENCES. 
(a) IN GENERAL.—Section 1308(c) of the National 
Flood Insurance Act of 1968 (42 U.S.C. 4015(c)) is amend-
ed— 
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(1) by redesignating paragraph (2) as para-
graph (4); and 
(2) by inserting after paragraph (1) the fol-
lowing new paragraphs: 
‘‘(2) NONRESIDENTIAL PROPERTIES.—Any non-
residential property, which term shall not include 
any multifamily rental property that consists of four 
or more dwelling units. 
‘‘(3) NON-PRIMARY RESIDENCES.—Any residen-
tial property that is not the primary residence of any 
individual, including the owner of the property or 
any other individual who resides in the property as 
a tenant.’’. 
(b) TECHNICAL AMENDMENTS.—Section 1308 of the 
National Flood Insurance Act of 1968 (42 U.S.C. 4015) is 
amended— 
(1) in subsection (c)— 
(A) in the matter preceding paragraph (1), 
by striking ‘‘the limitations provided under 
paragraphs (1) and (2)’’ and inserting ‘‘sub-
section (e)’’; and 
(B) in paragraph (1), by striking ‘‘, except’’ 
and all that follows through ‘‘subsection (e)’’; 
and 
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(2) in subsection (e), by striking ‘‘paragraph (2) 
or (3)’’ and inserting ‘‘paragraph (4)’’. 
(c) EFFECTIVE DATE AND TRANSITION.— 
(1) EFFECTIVE DATE.—The amendments made 
by subsections (a) and (b) shall apply beginning on 
January 1, 2011, except as provided in paragraph 
(2) of this subsection. 
(2) TRANSITION FOR PROPERTIES COVERED BY 
FLOOD INSURANCE UPON EFFECTIVE DATE.— 
(A) INCREASE OF RATES OVER TIME.—In 
the case of any property described in paragraph 
(2) or (3) of section 1308(c) of the National 
Flood Insurance Act of 1968, as amended by sub-
section (a) of this section, that, as of the effective 
date under paragraph (1) of this subsection, is 
covered under a policy for flood insurance made 
available under the national flood insurance pro-
gram for which the chargeable premium rates 
are less than the applicable estimated risk pre-
mium rate under section 1307(a)(1) for the area 
in which the property is located, the Director of 
the Federal Emergency Management Agency 
shall increase the chargeable premium rates for 
such property over time to such applicable esti-
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mated 
risk 
premium 
rate 
under 
section 
1307(a)(1). 
(B) ANNUAL
INCREASE.—Such increase 
shall be made by increasing the chargeable pre-
mium rates for the property (after application of 
any increase in the premium rates otherwise ap-
plicable to such property), once during the 12- 
month period that begins upon the effective date 
under paragraph (1) of this subsection and once 
every 12 months thereafter until such increase is 
accomplished, by 15 percent (or such lesser 
amount as may be necessary so that the charge-
able rate does not exceed such applicable esti-
mated risk premium rate or to comply with sub-
paragraph (C)). Any increase in chargeable pre-
mium rates for a property pursuant to this 
paragraph shall not be considered for purposes of 
the limitation under section 1308(e) of such Act. 
(C) PROPERTIES
SUBJECT
TO
PHASE-IN 
AND ANNUAL INCREASES.—In the case of any 
pre-FIRM property (as such term is defined in 
section 578(b) of the National Flood Insurance 
Reform Act of 1974), the aggregate increase, dur-
ing any 12-month period, in the chargeable pre-
mium rate for the property that is attributable 
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to this paragraph or to an increase described in 
section 1308(e) of the National Flood Insurance 
Act of 1968 may not exceed the following per-
centage: 
(i) NONRESIDENTIAL PROPERTIES.—In 
the case of any property described in such 
section 1308(c)(2), 20 percent. 
(ii) NON-PRIMARY
RESIDENCES.—In 
the case of any property described in such 
section 1308(c)(3), 25 percent. 
(D) FULL ACTUARIAL RATES.—The provi-
sions of paragraphs (2) and (3) of such section 
1308(c) shall apply to such a property upon the 
accomplishment of the increase under this para-
graph and thereafter. 
SEC. 5. EXCEPTION TO WAITING PERIOD FOR EFFECTIVE 
DATE OF POLICIES. 
Section 1306(c)(2)(A) of the National Flood Insurance 
Act of 1968 (42 U.S.C. 4013(c)(2)(A)) is amended by insert-
ing before the semicolon the following: ‘‘or is in connection 
with the purchase or other transfer of the property for which 
the coverage is provided (regardless of whether a loan is 
involved in the purchase or transfer transaction), but only 
when such initial purchase of coverage is made not later 
30 days after such making, increasing, extension, or re-
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newal of the loan or not later than 30 days after such pur-
chase or other transfer of the property, as applicable’’. 
SEC. 6. ENFORCEMENT. 
Section 102(f) of the Flood Disaster Protection Act of 
1973 (42 U.S.C. 4012a(f)) is amended— 
(1) in paragraph (5)— 
(A) in the first sentence, by striking ‘‘$350’’ 
and inserting ‘‘$2,000’’; and 
(B) in the last sentence, by striking 
‘‘$100,000’’ and inserting ‘‘$1,000,000; except 
that such limitation shall not apply to a regu-
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 lending 
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 imposed 
under this subsection on a regulated lending institu-
tion or enterprise that has made a good faith effort 
to comply with the requirements of the provisions re-
ferred to in paragraph (2) or for any non-material 
violation of such requirements.’’. 
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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 amended— 
(1) by redesignating subsection (c) as subsection 
(d); and 
(2) by inserting after subsection (b) the following 
new subsection: 
‘‘(c) MULTIPERIL COVERAGE
FOR DAMAGE FROM 
FLOOD OR WINDSTORM.— 
‘‘(1) IN GENERAL.—Subject to paragraph (8), the 
national flood insurance program established pursu-
ant to subsection (a) shall enable the purchase of op-
tional insurance against loss resulting from physical 
damage to or loss of real property or personal prop-
erty related thereto located in the United States aris-
ing from any flood or windstorm, subject to the limi-
tations 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 land use and control measures 
(with effective enforcement provisions) which the Di-
rector finds are consistent with the comprehensive cri-
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teria for land management and use relating to wind-
storms establish pursuant to section 1361(d)(2). 
‘‘(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 covered, at 
any time, by flood insurance coverage made available 
under this title. 
‘‘(4) NATURE
OF
COVERAGE.—Multiperil cov-
erage pursuant to this subsection shall— 
‘‘(A) cover losses only from physical damage 
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 windstorm or 
flooding, but shall not require for approval and 
payment of a claim that the specific cause of the 
loss, whether windstorm or flooding, be distin-
guished 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 
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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 referred 
to in section 1306(a), provide by regulation for the 
general terms and conditions of insurability which 
shall be applicable to properties eligible for multiperil 
coverage under this subsection, subject to the provi-
sions 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 
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‘‘(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 COVERAGE.— 
The regulations issued pursuant to paragraph (6) 
shall provide that the aggregate liability under 
multiperil coverage made available under this sub-
section shall not exceed the lesser of the replacement 
cost for covered losses or the following amounts, as ap-
plicable: 
‘‘(A) RESIDENTIAL
STRUCTURES.—In the 
case of residential properties— 
‘‘(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 structure; and 
‘‘(iii) $150,000 per dwelling unit for— 
‘‘(I) any contents related to such 
unit; and 
‘‘(II) any necessary increases in 
living expenses incurred by the insured 
when losses from flooding or windstorm 
make the residence unfit to live in. 
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‘‘(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; 
‘‘(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 in-
sured’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 deter-
mined based on the profits the covered 
business would have earned, based on 
previous financial records, had the 
flood or windstorm not occurred. 
‘‘(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 
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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, together 
with all interest owed on such notes and obligations, 
enter into any new policy, or renew any existing pol-
icy, 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: 
‘‘PROHIBITION AGAINST DUPLICATIVE COVERAGE 
‘‘SEC. 1314. Flood insurance under this title may not 
be provided with respect to any structure (or the personal 
property related thereto) for any period during which such 
structure is covered, at any time, by multiperil insurance 
coverage made available pursuant to section 1304(c).’’. 
(c) COMPLIANCE WITH STATE AND LOCAL LAW.—Sec-
tion 1316 of the National Flood Insurance Act of 1968 (42 
U.S.C. 4023) is amended— 
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(1) by inserting ‘‘(a) FLOOD PROTECTION MEAS-
URES.—’’ before ‘‘No new’’; and 
(2) by adding at the end the following new sub-
section: 
‘‘(b) WINDSTORM PROTECTION MEASURES.—No new 
multiperil coverage shall be provided under section 1304(c) 
for any property that the Director finds has been declared 
by a duly constituted State or local zoning authority, or 
other authorized public body to be in violation of State or 
local laws, regulations, or ordinances, which are intended 
to reduce damage caused by windstorms.’’. 
(d) CRITERIA FOR LAND MANAGEMENT AND USE.— 
Section 1361 of the National Flood Insurance Act of 1968 
(42 U.S.C. 4102) is amended by adding at the end the fol-
lowing new subsection: 
‘‘(d) WINDSTORMS.— 
‘‘(1) STUDIES AND INVESTIGATIONS.—The Direc-
tor shall carry out studies and investigations under 
this section to determine appropriate measures in 
windstorm-prone areas as to land management and 
use, windstorm zoning, and windstorm damage pre-
vention, and may enter into contracts, agreements, 
and other appropriate arrangements to carry out 
such activities. Such studies and investigations shall 
include laws, regulations, and ordinance relating to 
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the orderly development and use of areas subject to 
damage from windstorm risks, and zoning building 
codes, building permits, and subdivision and other 
building restrictions for such areas. 
‘‘(2) CRITERIA.—On the basis of the studies and 
investigations pursuant to paragraph (1) and such 
other information as may be appropriate, the Direct 
shall establish comprehensive criteria designed to en-
courage, where necessary, the adoption of adequate 
State and local measures which, to the maximum ex-
tent feasible, will assist in reducing damage caused by 
windstorms. 
‘‘(3) COORDINATION
WITH
STATE
AND
LOCAL 
GOVERNMENTS.—The Director shall work closely with 
and provide any necessary technical assistance to 
State, interstate, and local governmental agencies, to 
encourage the application of criteria established under 
paragraph (2) and the adoption and enforcement of 
measures referred to in such paragraph.’’. 
(e) DEFINITIONS.—Section 1370 of the National Flood 
Insurance Act of 1968 (42 U.S.C. 4121) is amended— 
(1) in paragraph (14), by striking ‘‘and’’ at the 
end; 
(2) in paragraph (15) by striking the period at 
the end and inserting ‘‘; and’’; and 
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(3) by adding at the end the following new para-
graph: 
‘‘(16) the term ‘windstorm’ means any hurri-
cane, tornado, cyclone, typhoon, or other wind 
event.’’. 
SEC. 8. MAXIMUM COVERAGE LIMITS. 
Subsection (b) of section 1306 of the National Flood 
Insurance Act of 1968 (42 U.S.C. 4013(b)) is amended— 
(1) in paragraph (2), by striking ‘‘$250,000’’ 
and inserting ‘‘$335,000’’; 
(2) in paragraph (3), by striking ‘‘$100,000’’ 
and inserting ‘‘$135,000’’; and 
(3) in paragraph (4), by striking ‘‘$500,000’’ 
each 
place 
such 
term 
appears 
and 
inserting 
‘‘$670,000’’. 
SEC. 9. COVERAGE FOR ADDITIONAL LIVING EXPENSES, 
BASEMENT 
IMPROVEMENTS, 
BUSINESS 
INTERRUPTION, AND REPLACEMENT COST OF 
CONTENTS. 
Subsection (b) of section 1306 of the National Flood 
Insurance Act of 1968 (42 U.S.C. 4013) is amended— 
(1) in paragraph (4), by striking ‘‘and’’ at the 
end; 
(2) in paragraph (5)— 
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(A) by inserting ‘‘pursuant to paragraph 
(2), (3), or (4)’’ after ‘‘any flood insurance cov-
erage’’; and 
(B) by striking the period at the end and 
inserting a semicolon; and 
(3) by adding at the end the following new para-
graphs: 
‘‘(6) in the case of any residential property, each 
renewal or new contract for flood insurance coverage 
shall provide not less than $1,000 aggregate liability 
per dwelling unit for any necessary increases in liv-
ing expenses incurred by the insured when losses from 
a flood make the residence unfit to live in, which cov-
erage shall be 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); 
‘‘(7) in the case of any residential property, op-
tional coverage for additional living expenses de-
scribed in paragraph (6) shall be made available to 
every insured upon renewal and every applicant in 
excess of the limits provided in paragraph (6) in such 
amounts and at such rates as the Director shall estab-
lish, except that such chargeable rates shall not be less 
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than the estimated premium rates for such coverage 
determined in accordance with section 1307(a)(1); 
‘‘(8) in the case of any residential property, op-
tional coverage for losses, resulting from floods, to im-
provements and personal property located in base-
ments, crawl spaces, and other enclosed areas under 
buildings that are not covered by primary flood in-
surance coverage under this title, shall be made avail-
able to every insured upon renewal and every appli-
cant, except that such coverage shall be made avail-
able only at chargeable rates that are not less than the 
estimated premium rates for such coverage determined 
in accordance with section 1307(a)(1); 
‘‘(9) in the case of any commercial property or 
other residential property, including multifamily 
rental property, optional coverage for losses resulting 
from any partial or total interruption of the insured’s 
business caused by damage to, or loss of, such prop-
erty from a flood shall be made available to every in-
sured upon renewal and every applicant, except 
that— 
‘‘(A) for purposes of such coverage, losses 
shall be determined based on the profits the cov-
ered business would have earned, based on pre-
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vious financial records, had the flood not oc-
curred; and 
‘‘(B) 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 
‘‘(10) in the case of any residential property and 
any commercial property, optional coverage for the 
full replacement costs of any contents related to the 
structure that exceed the limits of coverage otherwise 
provided in this subsection shall be made available to 
every insured upon renewal and every applicant, ex-
cept that such coverage shall be made available only 
at chargeable rates that are not less than the esti-
mated premium rates for such coverage determined in 
accordance with section 1307(a)(1).’’. 
SEC. 10. NOTIFICATION TO TENANTS OF AVAILABILITY OF 
CONTENTS INSURANCE. 
The National Flood Insurance Act of 1968 is amended 
by inserting after section 1308 (42 U.S.C. 4015) the fol-
lowing new section: 
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‘‘SEC. 1308A. NOTIFICATION TO TENANTS OF AVAILABILITY 
OF CONTENTS INSURANCE. 
‘‘(a) IN GENERAL.—The Director shall, upon entering 
into a contract for flood insurance coverage under this title 
for any property located in an area having special flood 
hazards— 
‘‘(1) provide to the insured sufficient copies of 
the notice developed pursuant to subsection (b); and 
‘‘(2) strongly encourage the insured to provide a 
copy of the notice, or otherwise provide notification of 
the information under subsection (b) in the manner 
that the manager or landlord deems most appro-
priate, to each such tenant and to each new tenant 
upon commencement of such a tenancy. 
‘‘(b) NOTICE.—Notice to a tenant of a property in ac-
cordance with this subsection is written notice that clearly 
informs a tenant— 
‘‘(1) that the property is located in an area hav-
ing special flood hazards; 
‘‘(2) that flood insurance coverage is available 
under the national flood insurance program under 
this title for contents of the unit or structure leased 
by the tenant; 
‘‘(3) of the maximum amount of such coverage 
for contents available under this title at that time; 
and 
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‘‘(4) of where to obtain information regarding 
how to obtain such coverage, including a telephone 
number, mailing address, and location on the World 
Wide Web of the Director where such information is 
available.’’. 
SEC. 11. INCREASE IN ANNUAL LIMITATION ON PREMIUM 
INCREASES. 
Section 1308(e) of the National Flood Insurance Act 
of 1968 (42 U.S.C. 4015(e)) is amended by striking ‘‘10 
percent’’ and inserting ‘‘15 percent’’. 
SEC. 12. INCREASE IN BORROWING AUTHORITY. 
(a) BORROWING AUTHORITY.—The first sentence of 
subsection (a) of section 1309 of the National Flood Insur-
ance Act of 1968 (42 U.S.C. 4016(a)), as amended by the 
National Flood Insurance Program Further Enhanced Bor-
rowing Authority Act of 2005 (Public Law 109–106; 119 
Stat. 2288), is amended by striking ‘‘$20,775,000,000’’ and 
inserting ‘‘$21,500,000,000’’. 
(b) FEMA REPORT.—Not later than the expiration of 
the 6-month period beginning on the date of the enactment 
of this Act, the Director of the Federal Emergency Manage-
ment Agency shall submit a report to the Congress setting 
forth a plan for repaying within 10 years all amounts, in-
cluding any amounts previously borrowed but not yet re-
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