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Flood Insurance

Flood Insurance Reauthorization

What is the fundamental issue?

Congress must reauthorize the National Flood Insurance Program (NFIP) to continue providing flood insurance after September 30, 2017.

I am a real estate professional. What does this mean for my business?

Without the NFIP, millions of home- and small business owners in more than 20,000 communities nationwide would not be able to obtain a mortgage or insurance to protect their property against the most expensive and common natural disaster in the U.S.: flooding. The NFIP was created because of the lack of access to affordable flood insurance coverage in the private market. It also reduced the number of uninsured properties that otherwise would rebuild with taxpayer-funded disaster relief after major floods.

NAR Policy:

NAR supports:

  1. Reauthorizing and gradually strengthening the NFIP so it is sustainable over the long run;
  2. Providing federal assistance to high risk property owners, including guaranteed loans, grants and buyouts in order to build higher and keep NFIP rates affordable;
  3. Encouraging the development of private market options to offer comparable flood insurance coverage at lower cost than NFIP;
  4. More granularly pricing NFIP policies to better reflect the property's specific risk; and
  5. Improving flood map accuracy so fewer property owners have to file expensive appeals.

Opposition Arguments:

Opponents believe that home buying in riskier flood zones will continue as long as flood insurance is underpriced by federal subsidies. As a result, the NFIP could be forced to borrow more to make up for shortfalls in premium revenue in order to cover the cost of future claim payments. 


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