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The Environmental and Energy Study Institute (EESI) invites you to a briefing on the National Flood Insurance Program (NFIP). Established by Congress in 1968, NFIP provides affordable, government-administered flood insurance to property owners, renters, and businesses. However, the NFIP is more than just an insurance program, it is also intended to be a floodplain management and flood risk mitigation program. NFIP requires participating communities to adopt and enforce minimum construction and land use regulations that make them less vulnerable to flooding. With over 5 million flood insurance policies in force, the NFIP is the single largest source of flood insurance for homeowners and small businesses.
As flood risks grow around the nation, this is an important time for Congress to reform and update this vital 50-year old program to better protect people and property. Without appropriate action, a warming climate coupled with continued development in flood-prone areas will raise the human and economic toll of flood disasters while taxpayer dollars are squandered on risky, business-as-usual practices. The NFIP has reached an important crossroads. After ten temporary extensions since 2017, the NFIP is set to expire on May 31. The program is popular, but it is more than $20 billion in debt, despite the cancellation of $16 billion in debt by Congress in October 2017. Flooding is the most pervasive and costly natural disaster in the United States, and climate change is exacerbating extreme weather events. Warmer temperatures lead to more water evaporation, which makes downpours more frequent and intense, leading to more flooding. Since the 1980s, the U.S. has experienced a $100 billion increase in total flood losses each decade; however, NFIP losses did not show a significant increase until the 2005 hurricane season. Fast-paced, inadequately regulated development in areas prone to flooding is also a major cause of such rising expenses.
This briefing will provide a basic understanding of the National Flood Insurance Program, its history, its challenges, and reforms needed. The panel will provide important background and highlight new strategies for improving NFIP’s financial stability and for reducing the impacts of future floods on vulnerable populations and communities.
Analyst in Flood Insurance and Emergency Management, Government and Finance Division, Congressional Research Service
Executive Director, Association of State Floodplain Managers (ASFPM)