flood insurance

The Federal Emergency Management Agency (FEMA) thankfully reversed a decision that would have imposed a moratorium on the writing of new flood insurance policies and the continuation of policies up for renewal during the federal government’s partial shutdown. 

Outcry from lawmakers, policyholders and lenders likely played a role in the decision to reverse the decision.

FEMA blamed the federal government shutdown for the move, which created undue stress on millions of policy holders up for renewal, not to mention those who sought insurance through the taxpayer-funded program to close on ownership of their new homes.

Even without a partial government shutdown, the short-term reauthorizations have made uncertainty a way of life for the 5 million homeowners who rely on the National Flood Insurance Program (NFIP) for flood insurance coverage.

The uncertainty is nothing new. Short-term renewals have become the norm since the July reauthorization.

Each short-term reauthorization has been implemented for the same reason – to work toward much-needed reforms in the program.

In much the same way that Louisiana residents see the state bypass budget reform year after year, Congress has not yet engaged in a serious discussion on how to stabilize the program to ensure long-term stability.

The scenario that ensued last week is really nothing new for NFIP policyholders.

Each reauthorization has come a day or so before the expiration of the program, which leaves policyholders wondering if Congress will not keep it intact – much like we’ve seen with the deadlock that led to the partial shutdown.

Nothing can excuse how they’ve treated policyholders.

They deserve better.

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