Senate Votes to Renew National Flood Insurance Program

The U.S. Senate passed legislation by unanimous consent on June 15 that reauthorizes the National Flood Insurance Program (NFIP) for five years.

The reauthorization was part of S. 2238, which reforms the program. The measure now goes to the House, where a vote is expected next week. The House had previously passed H.R. 253, which reforms and reauthorizes the NFIP.

Now, the Big “I” is strongly urging the House to take action on this bill before the June 30 deadline. In 2002, Congress adjourned without reauthorizing this vital program, leaving it in limbo for part of January 2003. Action is needed now to ensure this does not happen again.

“Industry and consumers faced uncertainty when the program lapsed, because they did not know if or when the program would be reauthorized, or what they should do in the meantime,” said Justin Roth, Big “I” vice president of federal government affairs.

Nevertheless, agent associations applauded the Senate vote.

“We are very pleased that the Senate has taken this much-needed action to renew this program,” said Charles E. Symington Jr., Big “I” senior vice president for federal government affairs.

The National Association of Professional Insurance Agents (PIA) praised the Senate vote as well. “PIA applauds the Senate for taking action prior to the June 30 deadline to reauthorize the flood insurance program,” said PIA National Assistant Vice President of Federal Affairs Peter Bizzozero in a written statement. “Senators have recognized the need for certainty in the availability of flood insurance coverage for homes and businesses by passing the five year reauthorization.”

The Bunning-Bereuter-Blumenaur Flood Insurance Reform Act of 2004 (S. 2238) would impose actuarial risk-based rates for flood insurance on property owners who have had two or more NFIP claims paid out by FEMA and who have refused buyouts, elevation or other flood mitigation measures funded by FEMA

Two weeks ago, several industry associations asked their members to contact members of Congress to urge passage of the flood insurance legislation before authorization for the NFIP expired. Congress had passed two temporary authorizations for the program this year, to give the Senate time to address proposed reforms.

Sen. Jim Bunning (R-Kentucky), chairman of the Subcommittee on Economic Policy of the Senate Banking Committee, who sponsored S. 2238, told PIA members during their Federal Legislative Summit in March, “When we reauthorize this bill it will be for five years. We won’t have to worry about the program expiring as you have for the last three years. Hopefully that will bring continuity and stability.”

Insurance company associations also lauded the passage of the bill.”NAMIC supports efforts to reauthorize and reform the national flood program,” said David Winston, NAMIC federal affairs senior vice president. “These reforms would help FEMA reduce the amount of money spent on frequently flooded properties,” said Winston.

Approximately 95 percent of the flood insurance sold in the United States is backed by the National Flood Insurance Program.