Sponsors (7)
Official title: To require the Secretary of the Treasury to establish a catastrophic property loss reinsurance program, and for other purposes.
Introduced July 17, 2025 by Sydney Kamlager-Dove · Last progress July 17, 2025
The bill aims to stabilize and expand federally backed catastrophe reinsurance and encourage mitigation—helping homeowners, businesses, insurers, and regulators manage disaster risk—but it increases taxpayer contingent exposure, may raise premiums and compliance burdens, and phases protections in slowly for some perils.
Homeowners, renters, small businesses, policyholders, and state insurance regulators gain access to a federal reinsurance backstop and fund that stabilizes the property-insurance market and reduces insurer insolvency risk after major catastrophes.
Homeowners and small businesses are incentivized to invest in loss-prevention because the program promotes insurer-policyholder mitigation partnerships and recognizes resilience upgrades, reducing future disaster losses.
Homeowners can obtain continuous multi-year (5+ year) coverage with more predictable premium adjustments tied to construction-cost and home-value indexes, lowering the risk of losing insurance after a disaster and improving pricing predictability.
Taxpayers face contingent liability because the Fund can issue Treasury-guaranteed notes/bonds and could require public resources if Fund proceeds are insufficient to cover catastrophic obligations.
Homeowners, renters, and small businesses may see higher insurance costs because participating insurers must pay quarterly premiums (with a minimum floor) and homeowners face index-linked premium growth tied to construction costs and home values.
Some property owners will remain unprotected for certain perils for years because the program phases in coverage for flood, earthquake, and other perils, delaying benefits for those risks.
Based on analysis of 5 sections of legislative text.
Creates a federal catastrophic reinsurance program that phases in coverage for major perils, sets premium/payment rules, requires relocation and earthquake feasibility reports, and pilots multi‑year policies.
Creates a federal catastrophic property reinsurance program (the Program) and a Federal Catastrophe Reinsurance Fund to provide backstop reinsurance to qualifying insurers for major catastrophe perils. The Program is to be set up by the Secretary within four years, phases in covered perils (wind/hurricane, severe convective storm, wildfire, flood, and potentially earthquake), sets premium and payment-threshold rules, and permits loss-prevention partnerships and multi-year insurance pilot policies to encourage mitigation. Also requires feasibility reports on a relocation fund for properties made effectively uninsurable and on adding earthquake coverage, and establishes a pilot program for multi-year all-perils property insurance with conditions on premium changes and loss-mitigation investments.