National Flood Insurance Program

The National Flood Insurance Program, NFIP, is administered by FEMA and protects home owners against flooding.  It allows owners in flood plains to purchase affordable flood insurance.

Currently, the NFIP is responsible for writing and renewing flood insurance policies for more than 5 million home and business owners and there is also a small and growing private market of flood insurance companies.

In July 2012, President Obama signed into law the Biggert-Waters Flood Insurance Reform Act of 2012, reauthorizing the NFIP for 5 years, the program is scheduled to expire in September 2017.

The 2012 Authorization also included many reforms that included more accurate floodplain maps to help homeowners and home buyers to better assess the risks of flooding.  These maps also help lenders to determine when they need to require flood insurance for properties purchased with federally backed mortgages that are located in FEMA designated areas.

In March of 2014, President Obama then signed into the law the Homeowner Flood Insurance Affordability Act, which limits premium increases to 18 to 25 percent and adds an assessment on policies until the owners are paying full costs for flood insurance.

The whole point of the NFIP is that it is much cheaper to underwrite insurance that it is to have the goverment cover all the cost of flooding disasters.

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