Kennedy Questions Tisler About FEMA Expensive Flood Insurance In Banking

Sen. John Kennedy (R-La.) pressed a banking committee witness during April 2023 testimony about the dramatic cost increases in FEMA’s National Flood Insurance Program — from $808 to $1,808 nationally after FEMA hired Milliman to develop a new algorithm. Kennedy criticized the federal government for making affordable housing more expensive through the mandatory flood insurance requirements, noting the contradiction between federal affordable housing advocacy and FEMA’s rate-raising policies.

The Kennedy Framework

Federal government: Federal government role.
Affordable housing: Affordable housing contradiction.
Cost increases: Cost increases.
Policy inconsistency: Policy inconsistency.
Professional critique: Professional critique.

The Specific Numbers

$808 original: $808 original.
$1,808 new: $1,808 new.
National average: National average.
Dollar increase: Dollar increase.
Percentage impact: Percentage impact.

The Milliman Algorithm

Consultant hire: Consultant hire.
New algorithm: New algorithm.
Rate calculation: Rate calculation change.
Policy implementation: Policy implementation.
Administrative decision: Administrative decision.

The Mortgage Requirement

Flood insurance mandate: Flood insurance mandate.
Mortgagee demand: Mortgagee demand.
Homeowner obligation: Homeowner obligation.
Banking requirement: Banking requirement.
Financial burden: Financial burden.

The FEMA Role

Federal agency: Federal agency.
Insurance administration: Insurance administration.
Risk assessment: Risk assessment.
Program management: Program management.
Professional oversight: Professional oversight.

The Affordable Housing Crisis

Housing costs: Housing costs.
Affordability issues: Affordability issues.
Federal policy: Federal policy.
Political priority: Political priority.
Economic impact: Economic impact.

The Algorithm Controversy

Risk calculation: Risk calculation.
Rate increases: Rate increases.
Homeowner impact: Homeowner impact.
Policy effects: Policy effects.
Professional debate: Professional debate.

The Louisiana Context

Parish system: Parish system reference.
Coastal risk: Coastal risk.
Flood history: Flood history.
Regional impact: Regional impact.
State-specific: State-specific.

The Kennedy Approach

Factual presentation: Factual presentation.
Specific examples: Specific examples.
Political theater: Political theater.
Constituent advocacy: Constituent advocacy.
Effective critique: Effective critique.

The Banking Committee

Committee jurisdiction: Committee jurisdiction.
Housing finance: Housing finance.
Insurance oversight: Insurance oversight.
Consumer protection: Consumer protection.
Financial regulation: Financial regulation.

The Tisler Position

Affordable housing advocate: Affordable housing advocate.
Policy expert: Policy expert.
Professional witness: Professional witness.
Agreement: Agreement on principle.
Limited response: Limited response.

The Federal Contradictions

Affordable housing push: Affordable housing push.
FEMA rate increases: FEMA rate increases.
Policy conflict: Policy conflict.
Administrative coordination: Administrative coordination.
Inter-agency issues: Inter-agency issues.

The National Flood Insurance

Federal program: Federal program.
Mandatory coverage: Mandatory coverage.
Rate structure: Rate structure.
Risk calculation: Risk calculation.
Administrative reform: Administrative reform.

The Housing Costs

Mortgage requirements: Mortgage requirements.
Insurance premiums: Insurance premiums.
Property taxes: Property taxes.
Closing costs: Closing costs.
Total ownership: Total ownership costs.

The Professional Standards

Actuarial analysis: Actuarial analysis.
Risk assessment: Risk assessment.
Algorithm review: Algorithm review.
Insurance principles: Insurance principles.
Professional oversight: Professional oversight.

The Political Context

Policy debate: Policy debate.
Administrative oversight: Administrative oversight.
Consumer protection: Consumer protection.
Political messaging: Political messaging.
Electoral concerns: Electoral concerns.

The Implementation Issues

Rate rollout: Rate rollout.
Transition costs: Transition costs.
Consumer impact: Consumer impact.
Market effects: Market effects.
Regional disparities: Regional disparities.

The Coastal Communities

Vulnerable areas: Vulnerable areas.
Flood risk: Flood risk.
Property values: Property values.
Economic impact: Economic impact.
Community disruption: Community disruption.

The Insurance Reform

National Flood Insurance Program: National Flood Insurance Program.
Actuarial accuracy: Actuarial accuracy.
Risk reflection: Risk reflection.
Program sustainability: Program sustainability.
Policy evolution: Policy evolution.

The Cost Analysis

Dollar amounts: Dollar amounts.
Percentage increases: Percentage increases.
Regional variations: Regional variations.
Income impact: Income impact.
Family budgets: Family budgets.

The Political Implications

Homeowner concerns: Homeowner concerns.
Electoral implications: Electoral implications.
Regional politics: Regional politics.
Party dynamics: Party dynamics.
Policy debates: Policy debates.

The Legislative Response

Congressional oversight: Congressional oversight.
Legislative reform: Legislative reform.
Budget process: Budget process.
Program authorization: Program authorization.
Administrative reform: Administrative reform.

The Homeowner Impact

Monthly costs: Monthly costs.
Insurance premiums: Insurance premiums.
Financial stress: Financial stress.
Property decisions: Property decisions.
Community stability: Community stability.

Key Takeaways

Sen. Kennedy challenged the federal government’s contradictory housing policies.
FEMA flood insurance costs increased from $808 to $1,808 nationally after new algorithm.
FEMA hired consultant Milliman to develop the new risk-rating algorithm.
Kennedy highlighted the contradiction with federal affordable housing advocacy.
Tisler agreed that government shouldn’t make affordable housing more expensive.
The exchange exposed inter-agency policy conflicts on housing affordability.

Transcript Highlights

The following quotations are drawn from an AI-generated Whisper transcript of the hearing and should be considered unverified pending official transcript release.

“Mr. Tisler, do you think the federal government should be making it more expensive to build affordable housing?” — Sen. Kennedy
“Absolutely not, sir.” — Mr. Tisler
“The mortgagee, the person owning the money, requires the homeowner to carry flood insurance. Yet, while you are here advocating as we all are for affordable housing, our federal government, through FEMA, is working as hard as it can to increase the cost of flood insurance.” — Sen. Kennedy
“FEMA hired a company called Milliman to write a new algorithm.” — Sen. Kennedy
“As a result of that algorithm, national flood insurance costs have gone, I’ll give you the national figure, from $808 to $1,808.” — Sen. Kennedy
“In my state, we call counties parishing.” — Sen. Kennedy

Full transcript: 117 words transcribed via Whisper AI.