Sponsors (2)
The bill expands federal reinsurance capacity and regulatory coordination to improve insurance availability and encourage mitigation, but it also increases taxpayer exposure, creates new premiums and compliance burdens for insurers and policyholders, and relies on studies and administrative actions that may delay direct relief.
Homeowners and small businesses gain broader access to federal catastrophe reinsurance, which can lower insurer costs and improve availability of all‑perils coverage in high‑risk areas.
Taxpayers and state regulators get a dedicated Federal Catastrophe Reinsurance Fund and pooled premium vehicle that centralizes claims‑paying capacity and aims to stabilize insurance markets through managed reserves and investments.
Homeowners and renters obtain greater policy stability because the bill enables 5+ year all‑perils policies and prohibits mid‑term premium increases based on newly phased‑in perils, preserving coverage continuity during multi‑year terms.
Taxpayers face substantial new financial exposure because the Fund can rely on federal borrowing (guaranteed bonds/notes) if pooled reserves are insufficient to cover catastrophic payouts.
Homeowners and small businesses may see higher insurance costs because participating insurers must pay mandatory quarterly Fund premiums and the bill sets premium floors and constrained annual change rules that can limit price responsiveness.
Homeowners and insurers face increased privacy and compliance risks because the program requires detailed quarterly policy‑level data reporting, raising the burden on insurers and the risk of personally identifiable information exposure.
Based on analysis of 5 sections of legislative text.
Introduced July 17, 2025 by Adam Schiff · Last progress July 17, 2025
Creates a federal catastrophic property reinsurance program and a dedicated fund to provide a backstop for qualifying primary insurers that write all‑perils property policies. The program phases in coverage for specific perils over several years, sets rules for premiums and claim thresholds, requires detailed insurer data reporting, authorizes Treasury to invest premiums and issue fully guaranteed U.S. obligations if needed, directs two feasibility studies (relocation fund and earthquake coverage), and establishes a pilot for multi‑year property policies with loss‑prevention partnership requirements.