Helping Homeowners Prepare for Hurricanes
Families in Florida and across the country need peace of mind that when a hurricane or another natural disaster strikes, they’ll be prepared. That’s why last week, I joined with the three of my colleagues – Representatives Ted Deutch (D-FL), Michael Grimm (R-NY), and Bill Pascrell, Jr. (D-NJ) – to introduce a bipartisan bill that will help homeowners prepared for and respond to future natural disasters.
Our bill, the Homeowner Catastrophe Protection Act of 2013, doesn’t create a new government program. Instead, it empowers homeowners to take mitigation measures that will protect their homes from damage when a hurricane or other disaster strikes. It also provides tax incentives to save money for rebuilding efforts.
As my friend and fellow Florida Representative Ted Deutch noted, “While Floridians have long struggled with the financial challenges that come with the constant threat of hurricanes and intense tropical storms, Superstorm Sandy recently showed us that no region of our country is immune from natural disasters. The Homeowner Catastrophe Protection Act represents a blend of bipartisan ideas that I am confident will help our nation and our communities better prepare for and recover from the damage inflicted by natural catastrophes.”
The Homeowner Catastrophe Protection Act (H.R. 549) combines three proactive initiatives into one comprehensive bill:
1) The Natural Disaster Mitigation Act would provide a tax credit (equal to 25% of mitigation expenditures up to $5,000) to homeowners who mitigate their homes to prevent or reduce the risks that can result from hurricanes and earthquakes. While mitigation will never eliminate the risk to homeowners, it could reduce loss and, in many cases, save a family’s home. In fact, studies have shown that for every $1 spent on mitigation, $4 in post storm cleanup and rebuilding is saved.
2) The Catastrophe Savings Accounts Act would create tax-exempt catastrophe savings accounts (CSAs) to pay expenses resulting from a presidentially declared major disaster. As Floridians know all too well, when a hurricane or other disaster strikes, the costs can be enormous, even if you have insurance. Tax-exempt CSAs would allow people to put away a little money each month, before taxes, and save it for when disaster strikes.
3) The Policyholder Disaster Protection Act would create a tax-deferred reserve that insurance companies can set up to cover the losses from future natural disasters. Currently, insurance companies can only reserve against losses that have already occurred, often leading to rate spikes after a disaster. Allowing insurance companies to save for future losses and take proactive measures to protect policyholders would help keep insurance rates under control.
Congressman Tom Rooney