Bill Summary
The proposed legislation aims to amend the National Flood Insurance Act of 1968 by removing restrictions that prevent "Write Your Own" (WYO) companies—private insurance firms that sell flood insurance under the National Flood Insurance Program (NFIP)—from offering their own private flood insurance products.
Key provisions include:
1. **Definition of Write Your Own Program**: It clarifies that WYO companies can sell flood insurance policies under their own business models and manage claims.
2. **Prohibition on Non-Compete Clauses**: The legislation explicitly prohibits the Federal Emergency Management Agency (FEMA) from enforcing non-compete clauses that would stop these companies from selling private flood insurance products while participating in the WYO program.
3. **Restrictions on Financial Agreements**: After enactment, FEMA cannot include any provisions in agreements with insurers that would impose such restrictions, thereby encouraging competition in the flood insurance market.
Overall, this legislation seeks to enhance competition by allowing WYO companies to offer additional flood insurance options beyond those provided by the federal program.
Possible Impacts
Here are three examples of how the legislation regarding the Write Your Own (WYO) program and the prohibition on non-compete clauses could affect people:
1. **Increased Competition and Choice for Consumers**: By allowing Write Your Own companies to sell private flood insurance without being restricted by non-compete clauses, consumers may benefit from a wider range of flood insurance options. This increased competition could lead to better coverage options, lower premiums, and improved customer service as companies vie for business.
2. **Potential for Lower Insurance Costs**: With the introduction of private flood insurance products that can compete with the National Flood Insurance Program (NFIP), there could be downward pressure on insurance rates. If private insurers can offer more competitive pricing, homeowners in flood-prone areas might find more affordable coverage compared to the government program.
3. **Impact on the National Flood Insurance Program**: If private flood insurance options become more attractive and affordable, it could reduce the number of policyholders in the NFIP. This might lead to financial challenges for the NFIP, which relies on premiums from its policyholders to cover claims and administrative costs. As a result, the NFIP may need to adjust its offerings or pricing to remain viable, potentially affecting those who rely on it for flood insurance.
[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 2053 Introduced in Senate (IS)]
<DOC>
119th CONGRESS
1st Session
S. 2053
To ensure that Write Your Own companies can sell private flood
insurance products that compete with National Flood Insurance Program
products.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
June 12, 2025
Mr. Scott of Florida introduced the following bill; which was read
twice and referred to the Committee on Banking, Housing, and Urban
Affairs
_______________________________________________________________________
A BILL
To ensure that Write Your Own companies can sell private flood
insurance products that compete with National Flood Insurance Program
products.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. PROHIBITION ON NON-COMPETE REQUIREMENT FOR WRITE YOUR OWN
COMPANIES UNDER THE NATIONAL FLOOD INSURANCE PROGRAM.
Section 1345 of the National Flood Insurance Act of 1968 (42 U.S.C.
4081) is amended by adding at the end the following:
``(f) Authority To Provide Other Flood Coverage.--
``(1) Write your own program defined.--In this subsection,
the term `Write Your Own Program' means the program under which
the Federal Emergency Management Agency enters into a standard
arrangement with private property insurance companies to--
``(A) sell contracts for flood insurance coverage
under this title under their own business lines of
insurance; and
``(B) adjust and pay claims arising under the
contracts described in subparagraph (A).
``(2) Prohibition on non-compete clause.--The Administrator
may not, as a condition of participating in the Write Your Own
Program or in otherwise participating in the utilization by the
Administrator of the facilities and services of insurance
companies, insurers, insurance agents and brokers, and
insurance adjustment organizations pursuant to the authority in
this section, nor as a condition of eligibility to engage in
any other activities under the National Flood Insurance Program
under this title, restrict any such company, insurer, agent,
broker, or organization from offering and selling private flood
insurance (as that term is defined in section 102(b) of the
Flood Disaster Protection Act of 1973 (42 U.S.C. 4012a(b))).
``(3) Financial assistance/subsidy arrangement.--After the
date of enactment of this subsection, the Administrator may not
include in any agreement entered into with any insurer for
participation in the Write Your Own Program any provision
establishing a condition prohibited under paragraph (2).''.
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