PIA Asks FEMA to Delay Start of Flood Insurance Risk Rating 2.0September 16, 2021
WASHINGTON – The National Association of Professional Insurance Agents (PIA) has asked the Federal Emergency Management Agency (FEMA) to delay the implementation of the National Flood Insurance Program’s (NFIP) new Risk Rating 2.0 (RR 2.0) methodology, which is scheduled to go into effect on October 1.
“RR 2.0 is not ready for its scheduled Oct. 1 implementation,” said Jon Gentile, PIA National vice president of government relations. “The prodigious efforts of agents, carriers and vendors were not enough to overcome the tremendous gaps in FEMA’s rollout process. PIA is not alone in reaching this conclusion; members of Congress on both sides of the aisle have also called for a delay.”
PIA strongly supports RR 2.0 and its move toward more risk-based pricing of flood insurance policies backed by the NFIP. In recent months, PIA became increasingly concerned about the rollout of the new rating system for a number of reasons including delays, confusion, failure of the rating engine, and the absence of adequate training for flood insurance agents who must accurately explain the changes to policyholders and prospective policyholders.
“PIA repeatedly expressed concern to FEMA representatives about the role of agents—and the resulting consumer experience—in the development and implementation of RR 2.0,” stated PIA in its letter to FEMA administrator Deanne Criswell. “PIA continually requested robust training and education to enable agents to guide policyholders through this unprecedented change in NFIP rates. Despite our efforts, agents were not provided with adequate training or education.”
“PIA firmly believes that RR 2.0 will ultimately better serve current and prospective policyholders,” stated Lauren G. Pachman, counsel and director of regulatory affairs for PIA National. “We want RR 2.0 to succeed. That has led us to conclude that RR 2.0 must be postponed until Apr. 1, 2022 for all policies, both new and renewing, so that these issues can be properly addressed. Policyholders (along with agents, vendors, WYOs, and other stakeholders) deserve an implementation experience that matches the quality of the RR 2.0 methodology itself.” Read PIA’s full blog post here.