Garbarino, Gonzales Lead Bipartisan Letter To FEMA Administrator Urging More Affordable Payment Options For NFIP Policy Holders

WASHINGTON, D.C. - This week, Congressman Andrew R. Garbarino (R-NY-02) and Congressman Vincente Gonzales (D-TX-34) led a bipartisan letter to Federal Emergency Management Agency (FEMA) Administrator Deanne Criswell requesting an update on FEMA’s implementation of an installment payment system to allow all National Flood Insurance Program (NFIP) policyholders to pay premiums in monthly installments instead of on an annual basis.

"As you know, flood insurance is an essential tool for homeowners, renters, and communities to proactively protect against flooding. Those with flood insurance are able to recover quicker and more comprehensively in the wake of a flood, making flood insurance a commonsense financial choice," the Members wrote. 

"A simple step toward ensuring broader flood insurance affordability would be to allow premiums to be paid in monthly installments, rather than on an annual basis...FEMA’s implementation of an installment payment system is long overdue, and we seek to understand what has contributed to the delays in carrying out this statutory directive," the Members continued. 

The letter points to the fact that, in its 2021 annual report, the Office of the Flood Insurance Advocate recommended that FEMA offer monthly premium payment options as a step towards potential relief from affordability challenges. Additionally, the Homeowner Flood Insurance Affordability Act of 2014 required FEMA to provide policyholders with the option of paying premiums annually or monthly. 

The Members requested responses to several questions including what FEMA’s plan is to implement the statutory directive to provide policyholders with the option of paying their NFIP premiums monthly, what FEMA’s timeline is to implement the statutory directive, what factors have contributed to delays in carrying out this statutory directive, what additional resources are needed for FEMA to implement this statutory directive, and what other barriers are preventing FEMA from implementing this statutory directive.

In addition to the co-leads, 20 bipartisan Members signed the letter including Representatives Chris Smith (R-NJ-04), Nicole Malliotakis (R-NY-11), Mike Lawler (R-NY-17), Mike Ezell (R-MS-04), Randy Weber (R-TX-14), Nick LaLota (R-NY-1), Monica De La Cruz (R-TX-15), Marc Molinaro (R-NY-19), Anthony D'Esposito (R-NY-04), Jerry Carl (R-AL-01), John Joyce (R-PA-13), Maria Salazar (R-FL-27), Russell Fry (R-SC-07), Nick Langworthy (R-NY-23), John Rutherford (R-FL-05), Jim Himes (R-CT-04), Josh Gottheimer (D-NJ-05), Troy Carter (R-GA-01), David Trone (D-MD-06), and Lizzie Fletcher (D-TX-07).

The full text of the letter can be found here and below.

Dear Administrator Criswell: 

We write to request an update on the Federal Emergency Management Agency’s (FEMA) implementation of an installment payment system to allow all National Flood Insurance Program (NFIP) policyholders to have the option to pay premiums in monthly installments instead of on an annual basis.

As you know, flood insurance is an essential tool for homeowners, renters, and communities to proactively protect against flooding. Those with flood insurance are able to recover quicker and more comprehensively in the wake of a flood, making flood insurance a commonsense financial choice.

One affordability hurdle people face in obtaining or maintaining insurance coverage is that those who do not escrow their flood insurance premiums with their mortgage payment, must pay premiums on an annual basis. Considering the average annual NFIP premium for a single-family home is nearly $900, and sometimes far more, a one-time payment is a financial hardship for many policyholders and deterrent to those who may otherwise obtain coverage. 

A simple step toward ensuring broader flood insurance affordability would be to allow premiums to be paid in monthly installments, rather than on an annual basis. In its 2021 annual report, the Office of the Flood Insurance Advocate recommended that FEMA offer monthly premium payment options as a step towards potential relief from affordability challenges. 

Additionally, the Homeowner Flood Insurance Affordability Act of 2014 (PL-113-89) required FEMA to provide policyholders with the option of paying premiums annually or monthly. Despite having 18 months from the date of enactment to comply with this, FEMA has yet to implement this provision.

FEMA’s implementation of an installment payment system is long overdue, and we seek to understand what has contributed to the delays in carrying out this statutory directive. In order to best support FEMA’s implementation of this provision, we ask that you respond to the following questions: 

1. What is FEMA’s plan to implement the statutory directive to provide policyholders with the option of paying their NFIP premiums in monthly installment payments as outlined in the Homeowner Flood Insurance Affordability Act of 2014?
2. What is FEMA’s timeline to implement this statutory directive? 
3. Recognizing that the implementation of a monthly installment payments system is long overdue, what factors or barriers have contributed to its delay? 
4. What, if any, additional resources are needed for FEMA to implement this statutory directive? 

We appreciate your prompt attention to this matter and request a response within 90 days of receipt. We look forward to your prompt response. 

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