Filed Under:Markets, Personal Lines

NFIP Gets One-Year Extension

NU Online News Service, Sept. 24, 2:55 p.m. EDT

A bill extending the National Flood Insurance Program for another year passed the House of Representatives yesterday and was sent to the White House.

The bill, S-3814, will extend the program for another year. Without the extension, the NFIP would have expired next week on Sept. 30. President Barack Obama is expected to sign the bill before the expiration date.

The measure passed the House yesterday on a voice vote and was passed in the Senate Tuesday also on a voice vote.

A number of insurance associations commended the House for passing the legislation but acknowledged that work on the program needed to be done.

"While we are pleased that Congress passed the one-year extension, there is still work to be done in the 112th Congress," said David Sampson, president and chief executive officer of the Property Casualty Insurers Association of America. "With over $18 billion in debt, the NFIP is a program that needs meaningful reform and a long-term reauthorization."

Passage of the bill, said Jimi Grande, senior vice president of federal and political affairs for the National Association of Mutual Insurance Companies, will not "fix the problems with the NFIP itself. The program is financially unsustainable and failing to address that only makes the problem worse for homeowners, insurers and the American taxpayers."

"A one-year extension gives Congress the time necessary to debate the more fundamental reforms the program needs," said Blain Rethmeier, a spokesman for the American Insurance Association. "But, between now and then, homeowners living in flood-prone areas will have the stability, protection and peace of mind to go on with their lives."

Charles E. Symington Jr., Independent Insurance Agents and Brokers of America senior vice president for government affairs, said passage of the bill would bring "much needed stability and security" to the program for some five-and-a-half million policyholders.

John Prible, IIABA vice president for federal government affairs, said recent natural disasters demonstrate the "urgency and importance" of the program and that the association looks forward to working with the Obama administration to add "business interruption insurance and additional living expenses coverage to the program."

The National Association of Professional Insurance Agents Director of Federal Affairs Mike Becker while praising passage said, "Local communities, states and the federal government all have a stake in making the flood insurance program work better for property owners and our nation's economy. PIA remains committed to continuing to work with the key members of Congress tasked with addressing NFIP reforms."

The association noted that a bill, passed by the House, H.R.-5114, would extend the program for five years and make additional reforms.

This story was updated with comments from PIA at 4:06 p.m.

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