The National Flood Insurance Program has more than 5.6 million subscribers. The Senate acted under pressure after opposition grew to the provision in the Biggert-Waters Act of 2012 that mandated actuarial rates for the NFIP over four years.

Sen. Heidi Heitkamp, D-N.D., cited the case of one homeowner in her state whose $60,000 NFIP policy was going to rise from the current $625 to $10,600 in one fell swoop.

However, it is unlikely that the Senate bill will pass the House in its present form, and there is some question about how quickly the House will even act on any legislation ameliorating the rate hikes even though bills implementing the new rates have been going out since last October.

Officials of the National Association of Mutual Insurance Companies and the Property Casualty Insurers Association of America voiced opposition, and they were joined by an unlikely ally: the Consumer Federation of America.

“Most people would assume that a consumer group such as CFA would seek lower insurance rates for consumers,” Robert Hunter, director of insurance for the CFA said in a statement.

“But we do not support lowering rates for an insurance program below sound prices, unless that is done by a separate program of subsidies, clearly identified and funded by taxpayers,” Hunter added.

One congressional observer predicted that the House “will drag its feet for a while, and it's likely the Senate bill is first taken up through a hearing before the House Financial Services Committee.”

Ray Lehmann, a fellow at the R Street Institute in Washington doubted that the Senate bill will even get a vote in the House, even though it has 185 co-sponsors in the House. “If a bill makes it to the House floor, it will look like the amendment sponsored by Sen. Pat Toomey, R-Pa.” he said. That amendment was defeated by the Senate, 65-34.

The Toomey amendment would cap annual rate hikes at 25 percent annually and pays for it by imposing a $40 on each NFIP policy, except for those with incomes about $500,000 who can pay up to $80 annually.

Toomey said in a statement, “This ensures that subsidies in the program are paid for within the program, protecting the majority of taxpayers who do not live in flood zones.”

Another industry lobbyist agreed that the Senate bill is unacceptable to the House, but that a strong vote in the Senate for its bill “might compel them to move more quickly.”

However, this lobbyist said, “Toomey was very persuasive on the floor,” implying that the Senate bill is unlikely to be the last word on the issue.

Sen. Robert Menendez, D-N.J., the primary sponsor of the legislation, stated in opposition to the Toomey amendment,

“The reality is that if you want the real estate market to take a real hit, if you want people, families, displaced from their homes, you adopt the Toomey amendment.”

The bill as it stands prevents flood-insurance rate increases until the Federal Emergency Management Agency's mapping methods are certified as technically sound and an affordability study is completed. The bill would keep in place a phase-out of subsidized flood-insurance premiums for vacation homes and homes that have a history of repeated flooding.

The Senate rejected any amendments to the bill, including one that would amend the definition of “private flood insurance” in the 2012 Biggert-Waters Act. The National Association of Insurance Commissioners and mortgage servicers found problems with the provision in the 2012 law that the proposed amendment sought to address.

However, the Senate rejected the amendment, 49-50. Menendez said the Senate should oppose the amendment because it would allow private insurers to offer flood insurance that doesn't set a minimum standard of coverage.

At the same time, Sen. Jeff Merkely, D, Oregon, withdrew under pressure an amendment that would have imposed federal standards on sale of force-placed insurance, including the commissions paid to insurance agencies by lender-placed insurers on flood coverage. The amendment faced opposition from banks, mortgage servicers and the Property Casualty Insurers Association of America.

In a statement released after the final vote, Jimi Grande, senior vice president of federal and political affairs for the National Association of Mutual Insurance Companies, said, “The legislation approved today by the Senate doesn't make flood insurance cheaper, it just makes the American taxpayer foot the bill for other peoples' flood insurance. It continues to hide the true risk that homeowners in flood-prone areas are facing and removes incentives for homeowners to protect their properties from flooding.”

Nat Wienecke, senior vice president, federal government relations for PCI, added, “A financially sound NFIP is critical for the 5.6 million Americans who have come to rely on the important protection provided by flood insurance.”

And, Sen. Robert Shelby, R-Ala., former ranking member of the Senate Banking Committee, said the bill goes too far. “I concede that there are some issues with the implementation of Biggert-Waters that were not anticipated,” he said. “But, those can be addressed in discrete ways that do not require the 'stop everything' approach that the proponents of this legislation are advocating.”

He added, “Congress is often criticized for being unable to fix anything. Well, in 2012 we took a very significant step towards fixing the National Flood Insurance Program. And now, we have a bill before us that will undo virtually every reform we enacted less than two years ago.”

The Independent Insurance Agents and Brokers of America voiced support for the bill, with President and CEO Robert Rusbuldt stating, “S. 1846 should mitigate some of the harmful effects of Biggert-Waters without undoing the numerous positive provisions within the law. The bill will also provide for streamlined non-resident insurance agent and broker licensing while preserving state insurance regulation and consumer protections.”

Mike Becker, executive vice president and CEO of the National Association of Professional Insurance Agents, noted the positives for homeowners, but also voiced concern: “Passage of this legislation will bring premium relief for the next four years to homeowners who faced the considerable burden of big increases in their flood insurance premiums. While that is positive, the bill will also add to the debt of the NFIP rather than reduce it.”

He aded, “This bill provides needed relief for some policyholders by 'kicking the can down the road' for four years on implementing actuarially sound rates for coverage necessary to stabilize the program. At some point, Congress will have to address a long-term solution. This bill does not provide a solution, only a postponement.”