FEMA Flood Insurance

FEMA Flood Insurance Program

The current Federal funding flood insurance program is set to expire Sept 30, 2011.  Over the past year the congressional budget wrangling has subjected this program to fits and starts, including two months without budget authorization.  The program is in the hole by $17.5 billion due to Katrina.

A house finance committee has been looking at this issue and has garnered further impetus with the current Mississippi flooding event.  The House committee passed a bill to:

• Provide funding over five more years;
• Allow premium increases beyond the existing 10% to as high as 20%;
• Permit private insurance participation, including reinsurance;
• Build in incentives to upgrade building codes;
• Establish a Technical Mapping Advisory Council in response to concerns expressed by members of Congress and constituents who may find themselves living in a flood plain under new flood maps and dispute the findings http://insurancenewsnet.com/article.aspx?id=260911&type=propertycasualty

 

The proposed changes look reasonable and will add stability.  The bill also contains language supporting flood insurance for business losses.  According to some reports, the House is looking to pass legislation by Memorial Day with a bill to be signed by the President by Labor Day.