The U.S. Senate passed a measure extending the nation’s flood insurance program through September 2009 last night.
While the U.S. House of Representatives passed an extension to the National Flood Insurance Program (NFIP) through Sept. 30, 2009, under the omnibus appropriations bill on Feb. 25, the Senate had yet to pass the legislation until late yesterday.
“PCI applauds Congress for acting to keep the National Flood Insurance Program in place,” said David A. Sampson, president and CEO of the Property Casualty Insurers Association of America (PCI).
“Allowing the program to expire would have very negative consequences for policyholders and also for the nation’s economy.
“Most home buyers use federally backed mortgages to purchase property, and such mortgages are prohibited by law for homes in floodplains unless they have flood insurance,” Sampson said. “Therefore it is crucial to keep this vital program running.”
The NFIP extension was set to expire at 11:59 p.m. on March 6, but Congress passed a continuing resolution on Friday to extend funding to federal programs under the omnibus bill, including the NFIP through today. But last night’s passage of the omnibus ensures a temporary extension of the NFIP, at least until further reform can be debated.
If the NFIP had expired today, agents and brokers would have no longer been able to write, renew or endorse NFIP policies.
Insurers and other industry groups hope that more work will be done to provide a long-term solution to problems that have plagued the NFIP for years.
“We continue to seek long-term reforms to this program to shore up its fiscal soundness,” Sampson said. “We will work closely with the House and Senate to advocate a long-term extension that preserves the program’s viability and does not needlessly expand its scope into other areas, such as windstorm insurance, where coverage is already available through private industry or state programs.”
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