[Congressional Bills 114th Congress]
[From the U.S. Government Publishing Office]
[S. 2324 Introduced in Senate (IS)]
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114th CONGRESS
1st Session
S. 2324
To provide for transparency, accountability, and reform of the National
Flood Insurance Program.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
November 19, 2015
Mrs. Gillibrand (for herself and Mr. Schumer) introduced the following
bill; which was read twice and referred to the Committee on Banking,
Housing, and Urban Affairs
_______________________________________________________________________
A BILL
To provide for transparency, accountability, and reform of the National
Flood Insurance Program.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Flood Insurance Transparency and
Accountability Act of 2015''.
SEC. 2. FLOOD INSURANCE TRANSPARENCY, ACCOUNTABILITY, AND REFORM.
(a) Reports and Other Claim-Related Documents.--Section 1312 of the
National Flood Insurance Act of 1968 (42 U.S.C. 4019) is amended by
adding at the end the following:
``(d) Final Engineering Reports.--The Administrator shall require
that, in the case of any on-site inspection of a property by an
engineer for the purpose of assessing any claim for losses covered by a
policy for flood insurance coverage provided under this title, the
final engineering report shall be provided to the insured under the
policy, as follows:
``(1) Timing.--The final engineering report may not be
transmitted to any other person, employer, agency, or entity,
before it is transmitted to the insured.
``(2) Prohibition on alterations; certification.--The final
engineering report may not include alterations by, or at the
request of, anyone other than the responsible in charge for
such report and shall include a certification, signed by the
responsible in charge for the report, that it does not contain
any such alterations.
``(3) Transmittal.--The final engineering report shall be
transmitted to the insured in a manner as the Administrator
shall provide that provides reasonable assurance that it was
transmitted directly to the insured by the responsible in
charge.
``(4) Reports covered.--For purposes of this subsection,
the term `final engineering report' means an engineering
report, survey, or other document in connection with such claim
that--
``(A) is based on such on-site inspection;
``(B) contains final conclusions with respect to an
engineering issue or issues involved in such claim; and
``(C) is signed by the responsible in charge or
affixed with the seal of such responsible in charge, or
both.
``(e) Claims Adjustment Reports.--The Administrator shall require
that, in the case of any on-site inspection of a property by a claims
adjustor for the purpose of assessing any claim for losses covered by a
policy for flood insurance coverage provided under this title, any
report shall be provided to the insured under the policy, as follows:
``(1) Timing.--Such report may not be transmitted to any
other person, employer, agency, or entity, before it is
transmitted to the insured.
``(2) Prohibition on alterations; certification.--The
report may not include alterations by, or at the request of,
anyone other than such preparer and shall include a
certification, signed by the preparer of the report, that it
does not contain any such alterations.
``(3) Transmittal.--The report shall be transmitted to the
insured in a manner as the Administrator shall provide that
provides reasonable assurance that it was transmitted directly
to the insured by the preparer.
``(4) Reports covered.--For purposes of this subsection,
the term `report' means any report or document in connection
with such claim that is based on such on-site inspection by the
claims adjustor, including any adjustment report and field
report. Such term also includes any draft, preliminary version,
or copy of any such report and any amendments or additions to
any such report. Such term does not include any engineering
report, as such term is defined for purposes of subsection (d).
``(f) Other Claim-Related Documents.--
``(1) Definition of claim-related document.--In this
subsection, the term `claim-related document' means any
document, other than a final engineering report (as defined in
subsection (d)) or a report (as defined in subsection (e)),
that was prepared for the purposes of assessing a claim for
losses covered by flood insurance made available under this
title, including--
``(A) a repair and replacement estimate or bid;
``(B) an appraisal;
``(C) a scope of loss;
``(D) a drawing;
``(E) a plan;
``(F) a report, including a draft report prepared
based on an on-site inspection of a property conducted
by a claims adjustor or engineer;
``(G) a third-party finding on the amount of loss,
amount of covered damage, or cost of repairs; and
``(H) any other valuation, measurement, or loss
adjustment calculation of the amount of loss, amount of
covered damage, or cost of repairs.
``(2) Availability of documents.--Any entity servicing a
claim under the national flood insurance program--
``(A) shall retain each claim-related document
prepared by or for the entity;
``(B) upon request by a claimant or an authorized
representative of a claimant, shall provide to the
claimant or representative a copy of any claim-related
document described in subparagraph (A) that pertains to
the claimant; and
``(C) not later than 30 days after receiving notice
of a claim, shall notify the claimant that the claimant
or an authorized representative of the claimant may
obtain, upon request, a copy of any claim-related
document described in subparagraph (A) that pertains to
the claimant.''.
(b) Judicial Review.--
(1) Government program with industry assistance.--Section
1341 of the National Flood Insurance Act of 1968 (42 U.S.C.
4072) is amended by striking ``within one year after the date
of mailing of notice of disallowance or partial disallowance by
the Administrator'' and inserting the following: ``not later
than the expiration of the 2-year period beginning upon the
date of the occurrence of the losses involved in such claim or,
in the case of a denial of a claim for losses that is appealed
to the Administrator, not later than (1) the expiration of the
90-day period beginning upon the date of a final determination
upon appeal denying such claim in whole or in part, or (2) the
expiration of such 2-year period, whichever is later''.
(2) Industry program with federal financial assistance.--
Section 1333 of the National Flood Insurance Act of 1968 (42
U.S.C. 4053) is amended by striking ``within one year after the
date of mailing of notice of disallowance or partial
disallowance of the claim'' and inserting the following: ``not
later than the expiration of the 2-year period beginning upon
the date of the occurrence of the losses involved in such claim
or, in the case of a denial of a claim for losses that is
appealed to the Administrator, not later than (1) the
expiration of the 90-day period beginning upon the date of a
final determination upon appeal denying such claim in whole or
in part, or (2) the expiration of such 2-year period, whichever
is later''.
(c) Flood Insurance Advocate.--Section 24(b) of the Homeowner Flood
Insurance Affordability Act of 2014 (42 U.S.C. 4033(b)) is amended--
(1) in paragraph (4), by striking ``and'' at the end;
(2) in subparagraph (5), by striking the period at the end
and inserting ``; and''; and
(3) by adding at the end the following:
``(6) provide a direct point of contact for policyholders
under the National Flood Insurance Program to discuss the
status of their claim appeals and the basis of the decision to
initially deny their claims.''.
(d) Records and Reviews.--Section 1348 of the National Flood
Insurance Act of 1968 (42 U.S.C. 4084) is amended by adding at the end
the following:
``(c) Annual Review.--The Administrator shall conduct an annual
review of each private entity participating in the national flood
insurance program, including any company that has entered into a
contract with a Write Your Own insurance company to provide any service
related to a policy or claim under the national flood insurance
program, including adjusting, engineering, and legal services, to
ensure compliance with this title and with all policies and procedures
established by the Administrator to prevent fraud and protect
policyholders.''.
(e) Publication of Claims Data.--Section 1312 of the National Flood
Insurance Act of 1968 (42 U.S.C. 4019), as amended by subsection (a),
is amended by adding at the end the following:
``(g) Publication of Claims Data.--Not later than 1 year after the
date of enactment of the Flood Insurance Transparency and
Accountability Act of 2015, the Administrator shall create and maintain
a publically searchable online database that includes, with respect to
claims filed under the national flood insurance program after that date
of enactment--
``(1) the number of claims filed each month, broken down by
State;
``(2) the number of claims paid in part or in full;
``(3) the number of claims denied and the reasons cited for
each denial; and
``(4) the number of claim denials appealed, the number of
claim denials upheld on appeal, and the number of claim denials
overturned on appeal.''.
(f) Engineering and Litigation Costs.--Section 1311 of the National
Flood Insurance Act of 1968 (42 U.S.C. 4018) is amended by adding at
the end the following:
``(c) Engineering and Litigation Costs.--The Administrator shall--
``(1) in order to ensure that taxpayer funds are being
appropriately expended, establish clear guidelines and
standards to require that any engineering or litigation cost
billed to the national flood insurance program by a Write Your
Own insurance company is justified on a case-by-case basis,
both by the entity that originally incurs the cost and by the
Write Your Own Company; and
``(2) enforce compliance with the guidelines and standards
established under paragraph (1).''.
(g) Earth Movement.--Section 1306 of the National Flood Insurance
Act of 1968 (42 U.S.C. 4013) is amended by adding at the end the
following:
``(e) Earth Movement.--A flood insurance claim filed under this
title for damage to or loss of property shall not be denied based on
the earth movement exclusion in the Standard Flood Insurance Policy if
the claim is filed as the result of a flood, including a claim for
damage to or loss or property caused by earth movement that was caused
by a flood.''.
(h) Appeals Process.--Section 205 of the Bunning-Bereuter-
Blumenauer Flood Insurance Reform Act of 2004 (42 U.S.C. 4011 note) is
amended--
(1) by striking ``Not later than'' and inserting ``(a) In
General.--Not later than''; and
(2) by adding at the end the following:
``(b) Review of Appeals.--
``(1) Clarity.--The Director shall ensure that the appeals
process established under subsection (a) has clear rules,
forms, and deadlines.
``(2) Notification upon initial denial of claim.--The
Director shall ensure that a claimant is provided with the
rules, forms, and deadlines described in paragraph (1) at the
time a claim is first denied in full or in part, including--
``(A) the effective date of the denial;
``(B) a justification for the denial, including
supporting documentation;
``(C) the date on which the period of limitation
for instituting an action against the Administrator on
the claim under section 1341 will end; and
``(D) a point of contact through which the claimant
can directly discuss an appeal with a representative of
the Federal Emergency Management Agency.
``(3) Notification upon denial of appeal.--If the
Administrator denies an appeal filed by a policyholder, the
Administrator shall include with the notice of denial an
explanation of the policyholder's legal options for further
challenging the denial.''.
(i) Definition of Write Your Own.--Section 1370(a) of the National
Flood Insurance Act of 1968 (42 U.S.C. 4121(a)) 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
(3) by adding at the end the following:
``(16) the term `Write Your Own' means the cooperative
undertaking between the insurance industry and the Federal
Insurance and Mitigation Administration which allows
participating property and casualty insurance companies to
write and service standard flood insurance policies.''.
SEC. 3. REPORTS TO CONGRESS.
(a) Definitions.--In this section--
(1) the term ``National Flood Insurance Program'' means the
program established under the National Flood Insurance Act of
1968 (42 U.S.C. 4001 et seq.);
(2) the term ``Task Force'' means the National Flood
Insurance Program Transformation Task Force established by the
Federal Emergency Management Agency; and
(3) the term ``Write Your Own'' has the meaning given the
term in section 1370(a) of the National Flood Insurance Act of
1968 (42 U.S.C. 4121(a)), as amended by section 2(i).
(b) Report to Congress on Accountability for Defrauding
Policyholders.--Not later than 90 days after the date of enactment of
this Act, the Secretary of Homeland Security shall submit to Congress a
report on specific actions the Department of Homeland Security will
take to identify individuals and private entities that have engaged in
activities to defraud policyholders under the National Flood Insurance
Program following Superstorm Sandy and prevent those individuals and
private entities from continuing to receive Federal funding through--
(1) contracts with, or employment by, a Write Your Own
insurance company; or
(2) employment by the Federal Emergency Management Agency.
(c) Report to Congress on Recommendations of the NFIP
Transformation Task Force.--Not later than 1 year after the date of
enactment of this Act, the Administrator of the Federal Emergency
Management Agency shall submit to Congress a report that describes--
(1) the recommendations of the Task Force for reforming the
National Flood Insurance Program;
(2) a timeline for implementing the recommendations of the
Task Force; and
(3) any recommendations of the Task Force that require
additional legislation.
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