It’s official: the federal flood insurance program will be around for at least one more year.
President Obama yesterday signed into law S. 3814, the bill that will extend the National Flood Insurance Program (NFIP) until Sept. 30, 2011.
Without the measure, the program would have expired last night. It has been allowed to lapse three times this year.
Insurance agents and companies welcomed the news, hoping it will buy time for Congress to address reforms of the program.
“Today’s signing will come as a relief for millions of Americans who could be affected by floods or just wish to buy or sell a home,” said Jimi Grande, senior vice president of federal and political affairs for the National Association of Mutual Insurance Companies. “However, the extension only maintains the program ‘as is.’ The NFIP is in serious financial trouble, and a simple extension such as this one will not help make the program self-sufficient or sustainable.
“The Big ‘I’ hopes that this one year extension will provide much needed stability and security for the NFIP and its five and a half million policyholders, but it’s also important to note that our work with this program is far from over,” said Robert Rusbuldt, president and CEO, the Independent Insurance Agents & Brokers of America (Big “I”). His group supports an increase in maximum coverage limits and the addition of optional business interruption insurance.
David Sampson, president and CEO of the Property Casualty Insurers Association of America, noted that the NFIP is currently saddled with more than $18 billion in debt. “While this bill was an important first step, Congress will still need to address meaningful NFIP reforms in 2011,” Sampson said.
American Insurance Association President and CEO Leigh Ann Pusey said that Congress now has the opportunity to tackle the “larger, more fundamental reforms” including NFIP premium subsidies and the mapping of flood plains.
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