The US Senate has given final congressional approval to a bill that would limit rate increases for federal flood insurance policies to 18 per cent per year.
The legislation also restored grandfathering, so that rates don't go up when flood maps are redrawn, and allowed home buyers to keep the same flood insurance premium subsidies that the sellers had.
A 2012 law that caused rate increases to be triggered by home sales caused strong objections in coastal areas because it made it so difficult to sell. That provision and others in the law had resulted in sharp rate increases for some homeowners.
The House of Representatives already passed the measure with support from both parties, and it is now headed to President Barack Obama's desk. Supporters expect he will sign it into law.
"This compromise will give homeowners some peace of mind, assuring them that their flood insurance rates will not immediately soar from several hundred dollars to the thousands and tens of thousands," said Republican Senator Roger Wicker.
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The legislation also provides refunds to homeowners who already paid high rates. In a separate voice vote, the Senate passed a bill that says that the refunds won't be given to owners of second homes.
Republican Senator Tom Coburn afterward declared that the Senate had failed to solve the problem of the National Flood Insurance Program, which is $US24 billion ($A26.67 billion) in debt.
He also asserted that most of those who will benefit from the lower rates are among the top 20 per cent of wealthiest Americans.
Americans for Prosperity and other conservative groups opposed the legislation, saying that the subsidies were not needed and calling for the government to stop requiring flood insurance.
