A bill recently approved by the Iowa House would create a private flood insurance market in the state.
By a 94-0 vote, House File 583 would establish a new industry overnight that would be an alternative to the often-high-priced federal option, says Republican State Representative Gary Mohr of Bettendorf. Currently, the only way Iowans can purchase flood insurance is through a federal program managed by FEMA.
?Seldom do we get a chance in a single bill to help jump start a new private sector marketplace product in Iowa,” said Mohr. “House File 583 does just that. It fosters innovation in the private sector residential flood insurance market.”
Mohr says any company that wants to provide private flood insurance in the state would have to be licensed to offer insurance in Iowa. They also must file their proposed rates with the state. Mohr notes those rates are not subject to prior approval.
“With Iowa being a leader in the insurance industry, we see this as a potentially big, new national private sector marketplace in the residential flood insurance market,” said Mohr. “This bill simply begins by creating a framework for offering private flood insurance.”
Republican State Representative Jon Jacobsen of Council Bluffs says the legislation comes as many southwest Iowa residents are still dealing with cleanup from the Missouri River flooding of 2019. He notes that he and other western Iowa lawmakers repeatedly hear about flood insurance concerns.
“Representative (David) Sieck and I literally not a day goes by without questions from constituents on the flooding,” said Jacobsen. “Flood insurance has been a big issue for them. As Representative Sieck has pointed out, we’re seeing that federal level decreasing while the rates are going up.”
The bill now heads to the Senate for further consideration.
