- § 4051. Industry flood insurance pool; requirements for participation
- § 4052. Agreements with flood insurance pool
- § 4053. Adjustment and payment of claims; judicial review; limitations; jurisdiction
- § 4054. Premium equalization payments; basis; aggregate amount; establishment of designated periods
- § 4055. Reinsurance coverage
- § 4056. Emergency implementation of flood insurance program; applicability of other provisions of law
- § 4057. Alternative loss allocation system for indeterminate claims
§ 4051. Industry flood insurance pool; requirements for participation
(a) The Administrator is authorized to encourage and otherwise assist any insurance companies and other insurers which meet the requirements prescribed under subsection (b) to form, associate, or otherwise join together in a pool—
(1) in order to provide the flood insurance coverage authorized under subchapter I; and
(2) for the purpose of assuming, including as reinsurance of coverage provided by the flood insurance program, on such terms and conditions as may be agreed upon, such financial responsibility as will enable such companies and other insurers, with the Federal financial and other assistance available under this chapter, to assume a reasonable proportion of responsibility for the adjustment and payment of claims for losses under the flood insurance program.
(b) In order to promote the effective administration of the flood insurance program under this part, and to assure that the objectives of this chapter are furthered, the Administrator is authorized to prescribe appropriate requirements for insurance companies and other insurers participating in such pool including, but not limited to, minimum requirements for capital or surplus or assets.
(Pub. L. 90–448, title XIII, § 1331, Aug. 1, 1968, 82 Stat. 582; Pub. L. 98–181, title I [title IV, § 451(d)(1)], Nov. 30, 1983, 97 Stat. 1229; Pub. L. 112–141, div. F, title II, §§ 100232(d)(1), 100238(b)(1), July 6, 2012, 126 Stat. 954, 958.)
§ 4052. Agreements with flood insurance pool
(a) Authorization
(b) Terms and conditions
Such agreements shall specify—
(1) the terms and conditions under which risk capital will be available for the adjustment and payment of claims,
(2) the terms and conditions under which the pool (and the companies and other insurers participating therein) shall participate in premiums received and profits or losses realized or sustained,
(3) the maximum amount of profit, established by the Administrator and set forth in the schedules prescribed under section 4018 of this title, which may be realized by such pool (and the companies and other insurers participating therein),
(4) the terms and conditions under which operating costs and allowances set forth in the schedules prescribed under section 4018 of this title may be paid, and
(5) the terms and conditions under which premium equalization payments under section 4054 of this title will be made and reinsurance claims under section 4055 of this title will be paid.
(c) Additional provisions
In addition, such agreements shall contain such provisions as the Administrator finds necessary to assure that—
(1) no insurance company or other insurer which meets the requirements prescribed under section 4051(b) of this title, and which has indicated an intention to participate in the flood insurance program on a risk-sharing basis, will be excluded from participating in the pool,
(2) the insurance companies and other insurers participating in the pool will take whatever action may be necessary to provide continuity of flood insurance coverage or reinsurance by the pool, and
(3) any insurance companies and other insurers, insurance agents and brokers, and insurance adjustment organizations will be permitted to cooperate with the pool as fiscal agents or otherwise, on other than a risk-sharing basis, to the maximum extent practicable.
(Pub. L. 90–448, title XIII, § 1332, Aug. 1, 1968, 82 Stat. 582; Pub. L. 98–181, title I [title IV, § 451(d)(1)], Nov. 30, 1983, 97 Stat. 1229; Pub. L. 112–141, div. F, title II, §§ 100232(d)(2), 100238(b)(1), July 6, 2012, 126 Stat. 954, 958.)
§ 4053. Adjustment and payment of claims; judicial review; limitations; jurisdiction
The insurance companies and other insurers which form, associate, or otherwise join together in the pool under this part may adjust and pay all claims for proved and approved losses covered by flood insurance in accordance with the provisions of this chapter and, upon the disallowance by any such company or other insurer of any such claim, or upon the refusal of the claimant to accept the amount allowed upon any such claim, the claimant, within one year after the date of mailing of notice of disallowance or partial disallowance of the claim, may institute an action on such claim against such company or other insurer in the United States district court for the district in which the insured property or the major part thereof shall have been situated, and original exclusive jurisdiction is hereby conferred upon such court to hear and determine such action without regard to the amount in controversy.
(Pub. L. 90–448, title XIII, § 1333, Aug. 1, 1968, 82 Stat. 583; Pub. L. 98–181, title I [title IV, § 451(d)(3)], Nov. 30, 1983, 97 Stat. 1229.)
§ 4054. Premium equalization payments; basis; aggregate amount; establishment of designated periods
(a) The Administrator, on such terms and conditions as he may from time to time prescribe, shall make periodic payments to the pool formed or otherwise created under section 4051 of this title, in recognition of such reductions in chargeable premium rates under section 4015 of this title below estimated premium rates under section 4014(a)(1) of this title as are required in order to make flood insurance available on reasonable terms and conditions.
(b) Designated periods under this section and the methods for determining the sum of premiums paid or payable during such periods shall be established by the Administrator.
(Pub. L. 90–448, title XIII, § 1334, Aug. 1, 1968, 82 Stat. 583; Pub. L. 93–234, title I, § 111, Dec. 31, 1973, 87 Stat. 981; Pub. L. 98–181, title I [title IV, § 451(d)(1)], Nov. 30, 1983, 97 Stat. 1229; Pub. L. 112–141, div. F, title II, § 100238(b)(1), July 6, 2012, 126 Stat. 958.)
§ 4055. Reinsurance coverage
(a) Availability for excess losses
(1) In general
(2) Private reinsurance
(b) Availability pursuant to contract, agreement, or other arrangement; payment of premium, fee, or other charge
(c) Excess loss agreement; negotiation
(d) Submission of excess losses on portfolio basis
(Pub. L. 90–448, title XIII, § 1335, Aug. 1, 1968, 82 Stat. 583; Pub. L. 98–181, title I [title IV, § 451(d)(1)], Nov. 30, 1983, 97 Stat. 1229; Pub. L. 112–141, div. F, title II, §§ 100232(d)(3), 100238(b)(1), July 6, 2012, 126 Stat. 954, 958.)
§ 4056. Emergency implementation of flood insurance program; applicability of other provisions of law
(a) Notwithstanding any other provisions of this chapter, for the purpose of providing flood insurance coverage at the earliest possible time, the Administrator shall carry out the flood insurance program authorized under subchapter I during the period ending on the date specified in section 4026 of this title, in accordance with the provisions of this part and the other provisions of this chapter insofar as they relate to this part but subject to the modifications made by or under subsection (b).
(b) In carrying out the flood insurance program pursuant to subsection (a), the Administrator—
(1) shall provide insurance coverage without regard to any estimated risk premium rates which would otherwise be determined under section 4014 of this title; and
(2) shall utilize the provisions and procedures contained in or prescribed by this part (other than section 4054 of this title) and sections 4081 and 4082 of this title to such extent and in such manner as he may consider necessary or appropriate to carry out the purpose of this section.
(Pub. L. 90–448, title XIII, § 1336, as added Pub. L. 91–152, title IV, § 408, Dec. 24, 1969, 83 Stat. 396; amended Pub. L. 92–213, § 2(a), Dec. 22, 1971, 85 Stat. 775; Pub. L. 93–234, title I, § 106, Dec. 31, 1973, 87 Stat. 979; Pub. L. 94–173, § 5, Dec. 23, 1975, 89 Stat. 1028; Pub. L. 94–375, § 14(b), Aug. 3, 1976, 90 Stat. 1075; Pub. L. 95–128, title VII, § 701(b), Oct. 12, 1977, 91 Stat. 1144; Pub. L. 95–406, § 6(b), Sept. 30, 1978, 92 Stat. 880; Pub. L. 95–557, title III, § 308(b), Oct. 31, 1978, 92 Stat. 2098; Pub. L. 96–153, title VI, § 602(b), Dec. 21, 1979, 93 Stat. 1137; Pub. L. 97–35, title III, § 341(b)(2), Aug. 13, 1981, 95 Stat. 419; Pub. L. 97–289, § 4(b), Oct. 6, 1982, 96 Stat. 1231; Pub. L. 98–35, § 4(b), May 26, 1983, 97 Stat. 198; Pub. L. 98–109, § 5(b), Oct. 1, 1983, 97 Stat. 746; Pub. L. 98–181, title I [title IV, § 451(b), (d)(1)], Nov. 30, 1983, 97 Stat. 1229; Pub. L. 99–120, § 4(a)(2), Oct. 8, 1985, 99 Stat. 503; Pub. L. 99–156, § 4(a)(2), Nov. 15, 1985, 99 Stat. 816; Pub. L. 99–219, § 4(a)(2), Dec. 26, 1985, 99 Stat. 1731; Pub. L. 99–267, § 4(a)(2), Mar. 27, 1986, 100 Stat. 74; Pub. L. 99–272, title III, § 3010(a)(2), Apr. 7, 1986, 100 Stat. 106; Pub. L. 99–289, § 1(b), May 2, 1986, 100 Stat. 412; Pub. L. 99–345, § 1, June 24, 1986, 100 Stat. 673; Pub. L. 99–430, Sept. 30, 1986, 100 Stat. 986; Pub. L. 100–122, § 1, Sept. 30, 1987, 101 Stat. 793; Pub. L. 100–154, Nov. 5, 1987, 101 Stat. 890; Pub. L. 100–170, Nov. 17, 1987, 101 Stat. 914; Pub. L. 100–179, Dec. 3, 1987, 101 Stat. 1018; Pub. L. 100–200, Dec. 21, 1987, 101 Stat. 1327; Pub. L. 100–242, title V, § 541(b), Feb. 5, 1988, 101 Stat. 1939; Pub. L. 101–137, § 1(b), Nov. 3, 1989, 103 Stat. 824; Pub. L. 101–508, title II, § 2302(b), Nov. 5, 1990, 104 Stat. 1388–23; Pub. L. 103–325, title V, § 571(b), Sept. 23, 1994, 108 Stat. 2277; Pub. L. 105–46, § 118, Sept. 30, 1997, 111 Stat. 1157; Pub. L. 105–65, title III, Oct. 27, 1997, 111 Stat. 1377; Pub. L. 105–276, title III, title V, § 599D(b), Oct. 21, 1998, 112 Stat. 2502, 2663; Pub. L. 107–73, title III, Nov. 26, 2001, 115 Stat. 689; Pub. L. 108–3, § 2(a)(3), Jan. 13, 2003, 117 Stat. 7; Pub. L. 108–171, § 2(a)(3), Dec. 6, 2003, 117 Stat. 2064; Pub. L. 108–199, div. H, § 136(a)(3), Jan. 23, 2004, 118 Stat. 442; Pub. L. 108–264, title I, § 101(c), June 30, 2004, 118 Stat. 714; Pub. L. 112–141, div. F, title II, § 100238(b)(1), July 6, 2012, 126 Stat. 958.)
§ 4057. Alternative loss allocation system for indeterminate claims
(a) DefinitionsIn this section:
(1) Administrator
(2) COASTAL Formula
(3) Coastal State
(4) Indeterminate loss
(A) In general
(B) RequirementsAn insurance claims adjuster certified under the national flood insurance program shall only determine that a loss is an indeterminate loss if the claims adjuster determines that—
(i) no material remnant of physical buildings or man-made structures remain except building foundations for the specific property for which the claim is made; and
(ii) there is insufficient or no tangible evidence created, yielded, or otherwise left behind of the specific property for which the claim is made as a result of the named storm.
(5) Named storm
(6) Post-storm assessment
(7) State
(8) Secretary
(9) Standard insurance policy
(10) Property
(11) Under Secretary
(b) Establishment of flood loss allocation formula for indeterminate claims
(1) In general
(2) ContentsThe standard formula established under paragraph (1) shall—
(A) incorporate data available from the Coastal Wind and Water Event Database established under section 3611(f) of title 33;
(B) use relevant data provided on the National Flood Insurance Program Elevation Certificate, or other data or information used to determine a property’s current risk of flood, as determined by the Administrator, for each indeterminate loss for which the formula is used;
(C) consider any sufficient and credible evidence, approved by the Administrator, of the pre-event condition of a specific property, including the findings of any policyholder or insurance claims adjuster in connection with the indeterminate loss to that specific property;
(D) include other measures, as the Administrator considers appropriate, required to determine and allocate by mathematical formula the property damage caused by flood or storm surge associated with a named storm; and
(E) subject to paragraph (3), for each indeterminate loss, use the post-storm assessment to allocate water damage (flood or storm surge) associated with a named storm.
(3) Degree of accuracy required
(c) Authorized use of post-storm assessment and COASTAL Formula
(1) In generalSubject to paragraph (3), the Administrator may use the post-storm assessment and the COASTAL Formula to—
(A) review flood loss payments for indeterminate losses, including as part of the quality assurance reinspection program of the Federal Emergency Management Agency for claims under the national flood insurance program and any other process approved by the Administrator to review and validate payments under the national flood insurance program for indeterminate losses following a named storm; and
(B) assist the national flood insurance program to—
(i) properly cover qualified flood loss for claims for indeterminate losses; and
(ii) avoid paying for any loss or damage to property caused by any peril (including wind), other than flood or storm surge, that is not covered under a standard policy under the national flood insurance program.
(2) Federal disaster declaration
(3) National Academy of Sciences evaluation
(A) Evaluation required
(i) EvaluationUpon publication of the COASTAL Formula in the Federal Register as required by subsection (b)(1), and each time the Administrator modifies the COASTAL Formula, the National Academy of Sciences shall—(I) evaluate the expected financial impact on the national flood insurance program of the use of the COASTAL Formula as so established or modified; and(II) evaluate the validity of the scientific assumptions upon which the formula is based and determine whether the COASTAL formula 1
1 So in original. Probably should be capitalized.
can achieve a degree of accuracy of not less than 90 percent in allocating flood losses for indeterminate losses.(ii) Report
(B) Effective date and applicability
(i) Effective date
(ii) Effect of modifications
(C) Funding
(d) Disclosure of COASTAL FormulaNot later than 30 days after the date on which a post-storm assessment is submitted to the Secretary under section 3611(b)(2)(E) of title 33, for each indeterminate loss for which the COASTAL Formula is used pursuant to subsection (c)(2), the Administrator shall disclose to the policyholder that makes a claim relating to the indeterminate loss—
(1) that the Administrator used the COASTAL Formula with respect to the indeterminate loss; and
(2) a summary of the results of the use of the COASTAL Formula.
(e) ConsultationIn carrying out subsections (b) and (c), the Secretary shall consult with—
(1) the Under Secretary for Oceans and Atmosphere;
(2) the Director of the National Institute of Standards and Technology;
(3) the Chief of Engineers of the Corps of Engineers;
(4) the Director of the United States Geological Survey;
(5) the Office of the Federal Coordinator for Meteorology;
(6) State insurance regulators of coastal States; and
(7) such public, private, and academic sector entities as the Secretary considers appropriate for purposes of carrying out such subsections.
(f) Recordkeeping
(g) Civil penalty
(1) In general
(2) Deposit
(h) Rule of construction
(i) Applicability
(j) Rule of Construction
(k) Rule of construction
(Pub. L. 90–448, title XIII, § 1337, as added Pub. L. 112–141, div. F, title II, § 100253, July 6, 2012, 126 Stat. 974; amended Pub. L. 116–271, title II, § 201(b), Dec. 31, 2020, 134 Stat. 3346.)