WASHINGTON—FEMA officials have announced various reforms to the National Flood Insurance Program (NFIP) the agency will pursue this year in an attempt to reduce the program's growing debt.
In November, the House passed legislation to renew the NFIP for five years, which includes provisions to update federal flood mapping procedures and allow private policies to fulfill the federal flood insurance mandate. The Senate has yet to take action on a reauthorization bill.
The program has received short-term renewals in federal spending bills passed since December. The omnibus bill signed into law last week only provides funding for the NFIP through July 31 in an attempt to have Congress work out reform details, NAFCU noted.
Many of the reforms being pursued by FEMA are similar to those being discussed by lawmakers, noted NAFCU, including:
- Rolling back restrictions to allow more insurance companies to offer their own flood coverage in addition to selling it on behalf of the government
- Reducing the fee paid by FEMA to private insurers who sell NFIP policies
- Expanding its reinsurance to limit the NFIP's need to borrow money from taxpayers
NAFCU noted that it has pushed for a number of improvements to the NFIP, including increases in coverage limits, and capping premiums and rates. The trade association said it will continue to monitor NFIP reform developments and keep its members updated as Congress and FEMA work to implement reforms.