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FEMA Restricts Access to NFIP WYO Deals

In a major change to 30-year-old rules, FEMA will no longer let the public see its deals with private insurers to administer National Flood Insurance Program coverage before the arrangements are finalized...
January 4, 2017

In a major change to 30-year-old rules, FEMA will no longer let the public see its deals with private insurers to administer National Flood Insurance Program (NFIP) coverage before the arrangements are finalized.

Bloomberg BNA reports that the new rules covering Write-Your-Own (WYO) flood insurance arrangements, effective Dec. 23, only allow FEMA and the insurers to see the contracts between them. Previously, all interested parties, such as consumers and insurance agents, had the opportunity to view proposed changes to the arrangements and weigh in throughout the contract’s drafting phase. Now, no parties other than FEMA and the insurers can see the contracts until they have been finalized.

FEMA is insisting that the new rules will increase, rather than decrease, transparency. Rafael Lemaitre, director of public affairs for FEMA’s office of external affairs, told Bloomberg BNA, “Under the new rule, we can simply pick up the phone and call [the companies]. This change makes the process more transparent.”

With the NFIP set to expire in September 2017, PIA supports a long-term reauthorization, along with steps to encourage the development of a private flood insurance market with strong consumer protections overseen by state insurance regulators. PIA opposes outright, immediate privatization of the National Flood Insurance Program (NFIP).