House Passes National Flood Insurance Program Extension
Earlier this week, the U.S. House of Representatives passed H.R. 3139, the National Flood Insurance Program (NFIP) Extension Act of 2009, which extends the program from its original expiration date of September 30, 2009, to March 31, 2010.
The extension was signed earlier this year by President Obama, just as the clock was ticking down on the original expiration. It is hoped that the current extension will give Congress enough time to apply long-term improvements to the NFIP.
According to Charles E. Symington, Jr., senior vice president for government affairs of the Independent Insurance Agents & Brokers of America this extension, “… is just a temporary fix, but a significant and welcome development for the millions of homeowners and small businesses who count on NFIP as a safety net in the event of flooding.” The Big “I” senior VP went on to say, “If the NFIP is allowed to expire, millions of consumers will be left vulnerable the next time a flood devastates a community.”
Flood insurance is a requirement in addition to basic homeowners insurance for certain mortgages on homes located in active floodplains. If the NFIP was to expire, real estate transactions in flood-prone areas would come to a standstill.
David A. Sampson, president and CEO of the Property Casualty Insurers Association of America (PCI) explains, “We cannot afford to compound the economic challenges our nation already faces by allowing the NFIP to lapse. This legislation will ensure that flood insurance consumers continue to be protected.”
Adds Leigh Ann Pusey, president and CEO of the American Insurance Association, “It’s critical that we make sure coverage remains available for citizens living in flood-prone areas”.
As of yesterday morning (July 30th) there was no information about whether or not the Senate would take action on the NFIP extension before their recess.
In the 110th Congress there was significant progress made on the Flood Insurance Reform and Modernization (FIRM) Act of 2007. Another reform effort is expected to move forward when the 111th Congress is convened this fall.