Are we at the end of the line for the National Flood Insurance Program Reauthorization?


It is a question that is being asked by many experts in the field, flood insurance policy holders, federal and state employees that are directly affiliated with FEMA and NFIP.

It is nothing new. Sadly, the potential for lapse has become increasingly common, with six short-term extensions of the program and two brief lapses since 2016. The current authorization for the NFIP will expire at midnight on November 30, 2018. These extensions are nothing more than a quick Band-Aid fix on an already deep wound. It doesn’t exactly fix anything, but keeps the NFIP bleed in a short extended limbo, just to go through the same, gut wrenching process all over again in a few months.

And while people may argue that there are more pressing matters plaguing this country at the moment, I would whole heartedly disagree. Yes, healthcare, education, social security, immigration – those are well known problems that don’t offer easy, simple or universally liked solutions.

But to push something as important as the National Flood Insurance Program on the back burner is not only foolish, it’s downright irresponsible.

Just taking the numbers from previous years, there were more than 15 floods in the last 3 years. From those, major hurricanes Irma and Harvey cost an estimated $69 billion dollars – and that’s the conservative estimate.

Weather around the world is getting more and more unpredictable and unstable. With hurricanes forming more often than ever, with record breaking winds, pushing further and further inland with each passing year. The experts predict dire consequences to climate change.

With numbers in billions of dollars in damages and news reporting loss of property – and unfortunately often lives as well – one cannot help, but to remain skeptical and baffled about the neglect in Congress why is more not being done?

True, NFIP needs reformation. There are significant financial losses – NFIP reportedly operates on $1,5 billion loss every year, currently with around $25 billion dollars in debt.  And that number is more likely to go up. But with NFIP shutdown, more than 40,000 real estate transactions a month are in jeopardy, facing delays or cancelations. This would put real estate market to downward spiral.

There are no quick or easy solutions to this conundrum. Reforms are long, painful and usually have to reach a compromise, where no one is completely satisfied, but all parties get something out of it and the final product is hopefully better than what was originally set in place.

One only has to look at the number of insurance companies, who even offer private flood insurance right now. It went from around 130 in 1983 to about 64 today. The reason is simple – flood insurance is not a very profitable business. Especially for properties that are being repeatedly flooded, year after year.

And just like with any other insurance premiums offered through the private market, the premiums would likely increase after each loss – flood. Something not a lot of people would be able to afford or could pay for out of their pocket.

Yes, NFIP is not the best solutions in its current form, but even with its obvious drawbacks and setbacks, it is the best flood insurance policy currently in place, safeguarding people against flooding, which is the most deadliest and destructive natural disaster.

When little over 39% of the population of the United States live on the coast, it’s not hard to understand the dire need for an agency like FEMA and for comprehensive and widely available flood insurance like NFIP.

I sincerely hope that come November 30, 2018, the Congress will get their act together and not only extended the NFIP, but will also work towards a reform that will help millions of people living in the areas that are effected by hurricanes, floods and other natural disasters.

Mahalo and stay safe.


The author and the publisher is solely responsible for the accuracy, and do not necessarily reflect the opinions, beliefs and viewpoints of DLNR Hawai'i and/or FEMA.


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