Senators Introduce Act to Reform, Reauthorize NFIP

A group of United States Senators proposed the Sustainable, Affordable, Fair, and Efficient National Flood Insurance Program Reauthorization Act (SAFE NFIP) on Tuesday, June 13, 2017. The Act will extend the National Flood Insurance Program (NFIP) for six (6) years and prevent flood premium rates from increasing more than 10 percent per year during that time. The bill is co-sponsored by Sens. Bob Menendez (D-NJ), John Kennedy (R-LA), Chris Van Hollen (D-MD), Marco Rubio (R-FL), Elizabeth Warren (D-MA), Thad Cochran (R-MS), Cory Booker (D-NJ), and Bill Nelson (D-FL).

The NFIP provides flood insurance to more than 20,000 communities, but the program will expire on September 30, 2017, without congressional reauthorization. The SAFE NFIP Act will lengthen the program, while addressing affordability among policyholders.

In addition, the Act will freeze interest payments on the NFIP’s debt to the US Department of the Treasury for six (6) years in an effort to fund mitigation projects to reduce risk in areas that are susceptible to flood.

“This bill helps ensure long-term stability, while providing much needed reforms to protect the program’s policyholders,” Sen. Rubio said in a statement. “It is past time for the federal government to take a more proactive approach in addressing the underlying risk affecting flood prone communities.”

The SAFE NFIP Act is one among many proposed bills that could reform and reauthorize the NFIP this legislative session. If the reforms are passed by Congress, it may open the flood insurance market to the private sector, including the excess and surplus lines market.