I 
116TH CONGRESS 
1ST SESSION 
H. R. 471 
To provide for greater transfer of risk under the National Flood Insurance 
Program to private capital and reinsurance markets, and for other purposes. 
IN THE HOUSE OF REPRESENTATIVES 
JANUARY 10, 2019 
Mr. LUETKEMEYER introduced the following bill; which was referred to the 
Committee on Financial Services 
A BILL 
To provide for greater transfer of risk under the National 
Flood Insurance Program to private capital and reinsur-
ance markets, 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 ‘‘Taxpayer Exposure 
Mitigation Act’’. 
SEC. 2. RISK TRANSFER REQUIREMENT. 
Subsection (e) of section 1345 of the National Flood 
Insurance Act of 1968 (42 U.S.C. 4081(e)) is amended— 
(1) by striking ‘‘(e) RISK TRANSFER.—The Ad-
ministrator’’ and inserting the following: 
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‘‘(e) RISK TRANSFER.— 
‘‘(1) AUTHORITY.—The Administrator’’; and 
(2) by adding at the end the following new 
paragraph: 
‘‘(2) REQUIRED RISK TRANSFER COVERAGE.— 
‘‘(A) REQUIREMENT.—Not later than the 
expiration of the 18-month period beginning 
upon the date of the enactment of this para-
graph and at all times thereafter, the Adminis-
trator shall annually cede a portion of the risk 
of the flood insurance program under this title 
to the private reinsurance or capital markets, or 
any combination thereof, and at rates and 
terms that the Administrator determines to be 
reasonable and appropriate, in an amount 
that— 
‘‘(i) is sufficient to maintain the abil-
ity of the program to pay claims; and 
‘‘(ii) manages and limits the annual 
exposure of the flood insurance program to 
flood losses in accordance with the prob-
able maximum loss target established for 
such year under subparagraph (B). 
‘‘(B) PROBABLE
MAXIMUM
LOSS
TAR-
GET.—The Administrator shall for each fiscal 
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year, establish a probable maximum loss target 
for the national flood insurance program that 
shall be the maximum probable loss under the 
national flood insurance program that is ex-
pected to occur in such fiscal year. 
‘‘(C) CONSIDERATIONS.—In establishing 
the probable maximum loss target under sub-
paragraph (B) for each fiscal year and carrying 
out subparagraph (A), the Administrator shall 
consider— 
‘‘(i) the probable maximum loss tar-
gets for other United States public natural 
catastrophe insurance programs, including 
as State wind pools and earthquake pro-
grams; 
‘‘(ii) the probable maximum loss tar-
gets of other risk management organiza-
tions, including the Federal National Mort-
gage Association and the Federal Home 
Loan Mortgage Corporation; 
‘‘(iii) 
catastrophic, 
actuarial, 
and 
other appropriate data modeling results of 
the national flood insurance program port-
folio; 
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