As another deadline approaches for the National Flood Insurance Program, advocacy groups are taking to Capitol Hill this week as Democrats and Republicans attempt to put together an amicable long-term extension before May 31.
Leading the way on Capitol Hill are the Property Casualty Insurers Association of America (PCI), the Independent Insurance Agents & Brokers of America (IIABA), the National Association of Realtors (NAR) and the Flood the Hill Coalition, comprised of real estate, financial services and construction industry trade associations from around the nation. The PCI has worked with both of the latter organizations in recent weeks to relay the importance of this extension, including a letter to Senate Majority Leader Harry Reid (D-Nev.) and Minority Leader Mitch McConnell (R-Ky.).
"More than 5.6 million policyholders in 21,000 communities nationwide depend on the NFIP as their main source of protection against property losses that result from flooding," the letter from the Coalition stated. "We are about to enter hurricane season again, and America cannot afford a lapse of the program."
Today, advocacy groups are getting a chance to speak at a Senate Banking hearing.
Jon Jensen, chairman of the IIABA government affairs committee, president of Correll Insurance Group and independent agent from South Carolina, was the only agent/broker witness at the hearing and spoke on behalf of the IIABA. Before the Senate committee, he outlined the IIABA’s advocacy for a modernized program and shored up finances, stating, “the current $17.2 billion debt, incurred in 2005, reveals some of the deficiencies of the program and has strained government resources. While IIABA is confident that the NFIP will recover, it is important that Congress shore up the NFIP’s financial foundation and use this opportunity to enact needed reforms to ensure the long-term sustainability of the program.”
NAR President Moe Veissi, who recently co-authored an op-ed for Roll Call surrounding this issue with PCI President and CEO David Sampson, is quoted by The Hill at the Senate Banking hearing today, saying continued failure to pass a long-term bill hurts the housing market and economy, and up to 13,000 real estate transactions per day could be blocked if the NFIP is allowed to lapse.
"The short-term extensions and shutdowns have exacerbated uncertainty in real estate markets and are inhibiting long-term investments that are vital to the U.S. economic recovery," said Veissi in a press release. "This is not a responsible way to run the program, especially since 5.6 million home and business owners in 21,000 communities rely on it.”
The current program expired in 2008 and has been floated 15 times since then on temporary extensions—much to the chagrin of real estate and insurance advocacy groups.
At the Senate hearing today, several other representatives from the insurance, real estate and environmental industries are also witnessing and testifying their belief that a long-term extension is in the nation’s best interests. According to various reports, however, Sen. Jon Tester (D-Mont.), in his opening remarks, reportedly spoke to the unlikelihood of a long-term extension being agreed upon before May 31.
While Democrats have provided unanimous consent for the short-term fix, they are attempting to use the looming deadline to pressure both sides into a long-term deal. The Republican retorts come from Sen. David Vitter (R-La.), who has claimed, regardless of what passes this month, he will propose a five-year reform bill as an amendment to whatever legislation is taken up by the Senate next. Another possibility is an extension of the existing program until December 31—after November’s elections—which Vitter also sponsored when previously proposed last year.
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