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Possible NFIP Extension to December Not Enough, PIA Warns

PIA is warning that a short-term National Flood Insurance Program (NFIP) extension lasting only until the end of December is problematic because Congress' schedule toward...
September 14, 2010

PIA is warning that a short-term National Flood Insurance Program (NFIP) extension lasting only until the end of December is problematic because Congress' schedule toward the end of the year is uncertain and another lapse could result. The NFIP is currently facing September 30 expiration.

"Right now, there is a possibility that Congress will consider an extension of the flood program through December 31, 2010," said a statement issued by PIA last week. "We believe this is problematic. It is not certain that there will be a substantive lame-duck session after the election. Passing an NFIP renewal that only runs through December 31 carries a high risk that the program will suffer yet another multi-week expiration that runs into January."

PIA noted that the best solution is for the Senate to now pass H.R. 5114, the Flood Insurance Reform and Priorities Act of 2010, which has already been passed overwhelmingly on a bipartisan basis in the House. H.R. 5114 extends the program for a full five years and makes key substantive reforms. The main issues of contention regarding the flood program -- its Katrina-related debt and the desire by some to add wind coverage to the program -- are not addressed in H.R. 5114 and can be dealt with in separate bills next year.

If action now on H.R. 5114 is not forthcoming in the Senate, however, lawmakers should pass an interim NFIP extension of sufficient length to avoid additional interruptions in the program and that allows sufficient time for hearings to be held next year.

Failure to extend the program or for the Senate to act on long-term reform and reauthorization legislation will cause disruptions to the real estate market and undermine confidence in the flood program, said PIA National Director of Federal Affairs Mike Becker, in comments to the National Underwriter. "It is critical that Congress break out of this almost decade-long pattern of 'expiration-and-short-renewal' that has delayed real reform, caused periodic disruptions to the real estate market and undermined confidence in the flood program," Becker noted. David Sampson, president and CEO of Property and Casualty Insurers Association of America (PCI), agreed, noting Congress has already allowed four NFIP lapses this year. "This is a dangerous political game that leaves millions of Americans vulnerable to severe weather," Sampson added.

Click here to read "Possible NFIP Extension Not Enough, PIA Warns" (National Underwriter 9/10/10)

Click here to read PIA's Statement on NFIP (PIA 9/9/10)

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