State Senate passes bill to ensure flood insurance to Green River Valley businesses

The Washington state Senate voted 30-18 Tuesday to help businesses in Kent, Auburn, Renton and Tukwila obtain hard-to-find supplemental flood insurance and prevent job losses.

Sens. Karen Keiser, D-Kent, Tracey Eide, D-Federal Way and Claudia Kauffman, D-Kent, called the passage of Senate Bill 6240 a victory for businesses and workers in the Green River Valley, who have been experiencing anxiety and uncertainty because of the potential for flooding and the lack of surplus flood coverage, according to a Senate Democrats media release.

The bill now goes to the House for consideration.

The legislation gives the state insurance commissioner authority to create a joint underwriting association if certain conditions are met. The JUA would act as a government-organized, non-profit insurance that could force insurance companies to provide insurance for businesses in the flood zone. The insurance commissioner must begin by forming a market assistance plan to help affected businesses. Underwriting operations can’t begin until the commissioner finds that:

• A MAP is inadequate because fewer than four admitted or surplus line insurers are offering excess flood insurance, exclusive of personal insurance.

• People, businesses, or service providers cannot buy excess flood insurance through the voluntary market; or

• So few insurers sell excess flood insurance that a competitive market does not exist.

Other provisions include:

• Coverage of any one policy may not exceed $5 million and the total amount of all coverage offered by the association may never exceed $250 million.

• A seven-member governing board will be created to oversee the JUA.

• The association must dissolve after a period of five years unless the Legislature authorizes an extension.

While basic flood insurance is available to homeowners and businesses from the federal government’s national flood insurance program, coverage is only offered up to $500,000 for a structure and $500,000 for contents.

“The federal program just isn’t enough for the businesses this bill is directed at,” Keiser said in the media release. “Some of these businesses have pieces of equipment which alone are worth more than a million dollars. This JUA will do what the market is not ─ offering surplus lines of coverage.”

Flooding remains a threat along the Green River because of a leak in an embankment next to the Howard Hanson Dam. The U.S. Army Corps of Engineers completed a grout curtain last fall as a temporary fix, but a permanent fix remains three to five years away.

The corps cannot store as much water as normal in the reservoir behind the dam. That means a heavy rainstorm could cause the river to overflow levees and flood local homes and businesses.

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