One-year Extension to Flood Insurance Program
It’s hard to believe it’s been over a month since we reported that the National Flood Insurance Program was on hold, but today’s report on the program is even better than yet another 30- or 60-day extension. Instead, we’re delighted to report that last night, in a unanimous vote, the United State Senate passed a measure extending the National Flood Insurance Program until September 30th, 2011. The measure still has to pass the House of Representatives, but since they passed a measure in July which extended it for five years, there is hope that this will be the political equivalent of a slam-dunk.
If, however, the House does not pass the Senate’s measure, the program, which covers more than five million Americans, will expire next Thursday, September 30, 2010.
Even with a year extension, however, the Senate measure is much shorter than the reauthorization requested by insurance companies and insurance agents, and it doesn’t include any of the verbiage meant to reform the program, which is currently operating at a deficit of $18 billion.
According to Marguerite Tortorello, senior vice president, public affairs, for the insurance group the Property Casualty Insurers Association of America (PCI), “This does not change the need for a long-term reauthorization that includes fundamental reform of the program and prevents the patchwork of short-term fixes that have allowed the NFIP to lapse four times this year.”
The vice president for federal government affairs of another organization, the Independent Insurance Agents Brokers of America, John Prible, also commented, saying, “Unfortunately, recent years have provided ample evidence of the destruction left behind by floods that highlight the urgency and importance of extending the NFIP. With the program set to once again expire Sept. 30, the Big ‘I’ urges the House to follow the Senate’s lead and immediately adopt the Senate-passed legislation.”
This year’s four extensions are not the first the NFIP has seen. It’s actually been operating under a series of such extension for two years now, and every time an extension lapsed, new policies could not be written, which left new homeowners with protection, and delayed thousands of real estate transactions every day in flood-prone areas.
The latest one-year extension (S3814) was sponsored by Sen. David Vitter, R-La., and co-sponsored by Sen. Lamar Alexander, R-Tenn., Sen. Saxby Chambliss, R-Ga., Sen. Kay Bailey Hutchinson, R-Tex., Sen. Johnny Isakson, R-Ga., Sen. Mary Landrieu, D-La., and Sen. Bill Nelson, D-Fla.