Sponsors
Introduced November 21, 2025 by Jared Moskowitz · Last progress November 21, 2025
The bill provides a federal reinsurance backstop and clearer rules that can stabilize property insurance markets and speed disaster payouts for homeowners and states, but it increases state and federal financial exposure, adds reporting and compliance burdens, and centralizes decision-making and data authority with risks to premiums, privacy, and fiscal accountability.
Homeowners nationwide in States that join: a federal reinsurance backstop and rapid post-disaster payments reduce insurer insolvency risk and help keep property insurance available after very large disasters.
Homeowners and renters: a clearer federal reinsurance program definition and eligibility rules can speed payouts after covered natural disasters, reducing recovery time for affected households.
State governments and local insurance markets: access to rapid federal funds (paid in installments) can prevent insurer insolvencies and stabilize local markets after catastrophic events.
State taxpayers and state budgets: States that participate must pledge full faith and credit and are required to repay federal payments with interest within 10 years, creating direct fiscal pressure on state budgets and taxpayers.
Federal taxpayers and fiscal policy: the Program increases federal borrowing and spending risk (federally guaranteed bond issuance and potentially open-ended Treasury funding), raising fiscal accountability concerns and possible long-term costs to taxpayers.
Homeowners and policyholders: premiums, coverage terms, or renewal outcomes may change when a State joins and because compliance costs can be passed on, potentially increasing out-of-pocket insurance costs for consumers.
Based on analysis of 5 sections of legislative text.
Creates a voluntary Treasury-run reinsurance program that pays states for residential insured losses from certified natural disasters above state triggers, with states repaying federal advances within up to 10 years.
Creates a voluntary federal reinsurance program at the Department of the Treasury to help states and insurers cover insured losses from major natural disasters that occur on or after January 1, 2026. Participating states must submit an approved plan, collect and report insurer loss and premium data, and pledge to repay federal payments within up to 10 years; the Treasury pays participating states industry-wide insured losses above a state-specific trigger in multiple installment payments based on loss estimates and later reconciliations. The Secretary of the Treasury administers the program in consultation with the Federal Insurance Office and may consult the NAIC, audit and investigate claims, prescribe rules, require insurer reporting, and hire staff and contractors to run the program; administrative costs are paid from the Treasury as needed. The law defines covered events, covered insurance (residential P&C, with specific exclusions), participating insurers, and other program terms, and establishes reporting requirements while federal payments remain outstanding and after final repayment.