The Senate Banking Committee has approved a flood insurance reform bill that would phase out subsidized premiums for second homes, commercial properties, and properties that repeatedly suffer major flood damage.Senate Banking Committee Chairman Richard Shelby, R-Ala., had promised a tough bill to make the flood insurance program actuarially sound, and the committee approved the bill by a 20-0 vote. Without these reforms, "the federal government will assuredly find itself bailing out the program, and exposing the American taxpayer to never-ending losses," Sen. Shelby said at the mark-up of the bill. However, the Mortgage Bankers Association is raising concerns that the bill could have "unintended consequences, including increasing the cost of homeownership, increasing delinquencies and foreclosures, and reducing property values."

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