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Federal Flood Program Revamp Remains Elusive

Business Insurance

The National Flood Insurance Program is in limbo, on the cusp of either another expiration or short-term extension without any reforms to the debt-ridden program, which would kick the issue down the road for a lame-duck Congress to navigate.


“The most important thing that it does is it provides money for five years in a row so it doesn’t go bankrupt, which it does every year as it stands today,” said Alan Rubin, a New York-based principal and member of Blank Rome L.L.C.’s severe weather emergency recovery team. “The second part of it is it redefines floodplains and how they need to be addressed and how they need to be redeveloped. It would not allow for the kind of thing that happened in Houston, where they just kept building in old floodplain areas and cementing over it. It rates areas by how many times they’ve flooded and whether it’s recurred and how many times it has recurred. It evaluates and grades the floodplain and charges more money per cost for insurance in the areas where it has flooded longer.”

But those provisions have not been taken up by the Senate, as the issue of charging more for insurance based on the repetitive nature of flooding remains a sticking point, he said.

“That’s the big problem,” he said. “But they’re going to have to do something. It’s my opinion that they will pass it in some form — not quite as draconian as it is in the bill today, but when the Senate and the House goes into conference they will make it better or different.”

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"Federal Flood Program Revamp Remains Elusive," by Gloria Gonzalez was published in Business Insuranceon July 31, 2018.