Trade Groups Put Pressure On House To Extend NFIP

NU Online News Service, June 1, 2:36 p.m. EDT

Twenty-six trade groups involved in the sale, financing and insuring of residential properties have signed a letter to the House leadership urging prompt action on legislation providing for a long-term reauthorization of the National Flood Insurance Program (NFIP).

The letter was sent just before Memorial Day to Speaker of the House John Boehner, R-Ohio, and Rep. Nancy Pelosi, D-Calif., minority leader.

It asks them to schedule floor action on the legislation at "the first available opportunity."

Currently, industry officials believe the bill will be scheduled for floor action next week or the week after.

That will leave the Senate with just a few legislative days to act on the legislation, and will place the bill on a crowded legislative agenda.

Moreover, no Senate committee has moved so far this year to deal with the legislation.

The legislation is H.R. 1309, the Flood Insurance Reform Act of 2011. It would reauthorize the program until Sept. 30, 2016 and would reform and revise the existing program.

The letter notes that without further action, the NFIP will expire Sept. 30. "More than 5.6 million policyholders depend on the NFIP as their main source of protection against flooding, the most common natural disaster in the United States," the letter says.

It adds, "A long-term extension is necessary to provide certainty to recovering real estate, insurance and financial markets and every participant in the economy that the NFIP affects—homeowners, small business owners, builders, real estate professionals, mortgage lenders, investors, insurance agents and insurance companies."

Most trade groups representing the property and casualty insurance industry signed the letter, including underwriters and agents and brokers.

Also signing the letter were trade groups representing the title insurance industry, mortgage bankers, realtors, banks, credit unions, homebuilders, securitizers and owners of multifamily structures.

The letter says that "the bill includes both a long-term reauthorization and important reforms that will optimize the current program with important coverage and rate reforms, needed improvements to the floodplain mapping and appeals processes, and other key reforms which would encourage program participation and put the NFIP back on the path to sound financial footing."