Down the Road Again

As spring folds into summer and tornado season segues into flood and hurricane season, federal lawmakers are revisting whether to reauthorize and reform the National Flood Insurance Program for what seems like the umpteenth time.

As one of the proponents of long-term reauthorization of the program, Sen. Jon Tester, D-Mont., said at a recent congressional hearing on the topic: “We’ve been down this road before.”

Indeed, since 2008, the NFIP program has been extended on a short-term basis 12 times.

It is once again set to expire at the end of May.

Tester and Sen. David Vitter, R-La., are urging fellow lawmakers to end the cycle of lapses and short-term reauthorization that further destabilizes a program that by all accounts needs serious attention.

Vitter is urging immediate consideration in the Senate of a five-year reauthorization. Vitter and others believe that a flood program reauthorization bill could be bipartisan legislation that might actually get passed by an extremely non-bipartisan Congress.

As Sen. Roger Wicker, R.-Miss., testified: Washington “needs a bipartisan” accomplishment and flood insurance legislation would be a good candidate for one.

Regardless of whether it improves the American public’s opinion of federal politicians, passage of a bill that addresses the long-term funding and operational challenges of the NFIP would be viewed as positive by insurers that work with the program and by millions of policyholders.

Jon A. Jensen, Government Affairs Committee chairman for the Independent Insurance Agents and Brokers of America and president of the Correll Insurance Group in South Carolina, spoke on behalf of the agent association in support of a long-term solution for the NFIP. He said Congress should modernize the program, which is $17.2 billion in debt, and shore up its finances.

Jensen said the insurance market and flood insurance consumers are increasingly frustrated with the nature of the short-term extensions granted to the program and that a long-term extension would bring the stability they deserve.

David A. Sampson, president and CEO, Property and Casualty Insurers Association of America (PCI), also testified in favor of long-term plan.

“A long-term reauthorization will ensure that there will be no gaps in coverage, which occurred four times in 2010 alone, each lapse longer than the previous with increasing uncertainty and frustration among consumers and providers,” Sampson said.