Senate Banking Committee to launch working group to identify long-term NFIP solutions

By Isha Marathe

Jan 30 - (The Insurer) - Senate Banking Committee chairman Senator Tim Scott (R-SC) has announced the launch of a working group to reform the National Flood Insurance Program (NFIP).

Senators John Kennedy (R-LA) and Mike Rounds (R-SD) will lead the working group with an aim to identify solutions for a long-term reauthorisation of the NFIP.

The reforms will aim to foster the adoption of a sustainable flood insurance market, ensure the long-term fiscal sustainability of the program, and align incentives to help families and communities prepare for and recover from flooding, according to the press release from Scott's office.

"Currently, the National Flood Insurance Program is not working for the Louisianians or Americans who need it. That makes it impossible to protect their biggest assets — their homes. Our people deserve a National Flood Insurance Program that looks like someone designed the thing on purpose. That’s why Sen. Scott, Sen. Rounds, and I are working to reform and bring transparency to the program,” Kennedy said.

Approximately six million homes are currently located in special flood hazard areas nationwide, according to the Federal Emergency Management Agency. The National Association of Realtors estimates that should a lapse in the NFIP’s authorisation occur, it would threaten 1,300 property sales each day.

“The National Flood Insurance Program has been operating under a short-term reauthorisation for years and with $20bn in debt, the program is in desperate need of reform," Rounds said.

"It is time that Congress do the full work of actually reforming the program to provide long-term certainty to homeowners, financial institutions, insurers, and other stakeholders. As a former insurance agent, I am grateful to Chairman Scott for trusting Senator Kennedy and myself with this task and we are ready to get to work."