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IIABA Applauds House Passage of National Flood Insurance Program Reauthorization Bill

Big “I” Priority Is to Ensure NFIP Does Not Lapse, Homeowners Remain Protected

WASHINGTON, D.C., Nov. 20—The Independent Insurance Agents & Brokers of America (IIABA) is praising members of the U.S. House of Representatives today for passing legislation to reauthorize the National Flood Insurance Program (NFIP) for the next five years.


The House bill (H.R. 253) will make some legitimate reforms to the NFIP and extend reauthorization beyond the usual one-year duration period. The legislation now heads to a House-Senate conference committee. The Senate has passed a one-year reauthorization bill for the NFIP that includes no reforms to the program.


“IIABA supports the House bill, but we also want to make sure there is no lapse in the program. So, the House also has indicated its willingness to do a straight short-term reauthorization of the flood program in order to give the Senate time to consider the reforms. This makes a lot of sense,” says IIABA Sr. Vice President of Government Affairs Maria Berthoud. “We are working to ensure that the NFIP is reauthorized in one form or another to keep the program from lapsing in a fashion similar to last year.”


Due to procedural oversights by government officials, Congress failed to reauthorize the NFIP before leaving town in 2002, and numerous homeowners began the New Year wondering whether their properties were covered. The program remained on hiatus until Congress reconvened later in January 2003 and passed a retroactive reauthorization.   Failure to reauthorize the NFIP would cause significant market disruption and potentially leave agents and brokers with additional legal exposure. 


“Our number-one priority is to ensure that the program does not expire and all homeowners still have access to flood insurance on January 1,” Berthoud says. “IIABA and its 300,000 members strongly urge the members of the conference committee to make sure the focus of their negotiations on this bill is to reauthorize the NFIP before the end of the year. Now is not the time for the House and Senate to debate differing provisions for days and leave town without reaching a compromise.”


According to IIABA Director of Federal Government Affairs Justin Roth, an important compromise was reached today between Rep. Richard Baker (R-La.) and Rep. Bob Ney (R-Ohio). The compromise only will have FEMA target the worst repetitive properties, which are roughly the worst 10,000 homes. Also, under this agreement, FEMA now will have the resources to offer up to 90 percent of the mitigation costs to those properties it targets, which is up from the current 75 percent. Roth says, “We believe that this reform accomplishes the desired reforms, while being sensitive to those homeowners who are in the unfortunate circumstance of being in a repetitive flood loss property.” 


Insurance companies issue flood policies as part of the NFIP under an arrangement with the federal government. The NFIP was established by Congress in 1968 to provide flood insurance protection to the nation’s homeowners, who previously could not acquire such coverage through the private sector and had to rely on government assistance following a flood disaster. The NFIP operates under authority from Congress that has to be renewed annually.


The Senate passed its version of the bill (S. 1768) on October 27. The House Financial Services Committee has shepherded the House legislation, and IIABA particularly cites Baker, Ney, and Rep. Doug Bereuter (R-Neb.) as well as full committee chairman Mike Oxley (R-Ohio) for their efforts in gaining House approval of NFIP reauthorization.


“IIABA commends Rep. Baker for his tireless work and strong support of independent agents and brokers and the National Flood Insurance Program,” says Roth. “Rep. Bereuter also has been working long and hard on this issue and his diligence as well as the leadership of Reps. Oxley and Ney is going to bring peace of mind to thousands of homeowners around the country, provided the members of the conference committee now take the necessary steps to ultimately approve reauthorization of the program.”


Founded in 1896, IIABA is the nation’s oldest and largest national association of independent insurance agents and brokers, representing a network of more than 300,000 agents, brokers and their employees nationally. Its members are businesses that offer customers a choice of policies from a variety of insurance companies. Independent agents and brokers offer all lines of insurance—property, casualty, life, health, employee benefit plans and retirement products. Web address:



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Alexandria VA 22314
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fax: 703.683.7556

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