If Today’s Bid Fails, Next Likely Vote to Restart Flood Insurance: July 12

The future of the National Flood Insurance Program (NFIP) remains in limbo even as Hurricane Alex makes its way to the Texas coast today.

Washington lobbyists say a vote could come today but if that doesn’t happen it could be until July 12 or thereafter before another vote is possible since Congress will not be around during the July 4th holiday.

The NFIP expired on June 1, the first official day of hurricane season. Since then, flooding has occurred in several states.

On June 23, the House of Representatives passed another temporary extension of the NFIP, good through Sept. 30, 2010, but the Senate has failed to take action so far.

Even if the Senate passed an NFIP extension, a flood insurance policy normally does not go into effect for 30 days after the policy is purchased, further underscoring the importance of renewing the program as quickly as possible, says the National Association of Insurance Commissioners (NAIC). The NAIC has sent a letter to House and Senate leaders urging immediate action to extend the National Flood Insurance Program (NFIP). In the letter, regulators stressed that timing is negatively affecting consumers.

“As state regulators, we are deeply concerned with the impact the nearly month-long lapse has caused for consumers and future flood victims across the country,” said Jane L. Cline, NAIC president and West Virginia Insurance Commissioner. “It is imperative that Congress act to quickly to extend the program so that consumers can protect themselves.”

Blain Rethmeier, senior vice president for public affairs for the American Insurance Association, says right now the future of the NFIP remains in limbo with no clear legislative path for a retroactive extension of the program.

“There is a slim chance the Senate will have an opportunity to pass the short term extension, but with Senator Byrd’s funeral, it looks unlikely,” Rethmeier said. “We very well could go into the July 4th recess without any resolution.”

Sen. David Vitter of Louisiana brought the NFIP extension through Sept. 30 to the Senate floor for unanimous consent yesterday, according Matt Brady, director of media relations for the National Association of Mutual Insurance Cos. (NAMIC). But Sen. Dick Durbin of Illinois objected and offered the “extenders” bill, legislation that would extend the program through the end of the year but also includes other provisions that have drawn objections for increasing the budget deficit, according to Brady. Brady said Sen. Vitter then objected to the extenders bill.

“It’s possible that it could be brought to the floor for unanimous consent again today,” Brady said, but cautioned that if nothing happens today, the Senate would be less likely to take action tomorrow because of the memorial service planned for the late Sen. Robert Byrd. “They’re also out all next week, so if they adjourn without extending the program nothing can happen until July 12 or 13 at a minimum.”

The program has been unable to issue new or renewal policies since it was shut down May 31, although it is still paying claims. It is the fourth time in the past year that the program has been interrupted due to the failure of Congress to reauthorize it for an extended period.