The NFIP – which covers more than five million policyholders – is a $ 20 billion debt; indeed, it just had $ 16 billion in debt forgiven by taxpayers' money. Congress has recently passed on 10 short-term extensions of NFIP, but lawmakers believe that more needs to be done to save the failing NFIP from its financial and administrative issues.
The congress met yesterday to discuss how to address the problems with the water insurance program, St. Louis Post Message reported.
Senior members of the House Financial Services Committee have insisted on meaningful reforms for the NIV. Rep. Blaine Luetkemeyer, R-St. Elizabeth, MO has recently introduced a number of bills to reform the program. Similarly, representatives William Lacy Clay, D-University City and Ann Wagner, R-Ballwin, are involved in the process of developing a five-year authorization period for the program.
"It is a long-term problem that we need to solve, rather than coming up with these short-term solutions," Clay said. "We all represent different regions & # 39; s – but in our region our flood is seasonal, it happens as a timepiece. … We have to approach this in a pragmatic way that solves the problem."
Clay argued that as the flood increased over time, the 51-year-old NFIP could not keep up with the losses. The program had so much trouble covering flood costs that the Federal Emergency Management Agency (FEMA), responsible for NFIP, had to gradually borrow more money to cover claims. The one led to the other, as several homeowners were unable to pay the premium costs and the private and reinsurance markets were unable to bridge the gaps of NFIP.
Lawmakers also fear that the Trump administration is proposing a plan to review the way in which risks are assessed – a plan that critics say could result in higher premiums while covering less damage.
Private witnesses and advocacy organizations also attended the hearing yesterday, and told committee members to consider a more comprehensive solution that included more than just insurance.
Several witnesses mentioned that the US has enough flood maps for about a third of the country, while others said the federal government has fallen on funding mitigation projects to prevent flood damage. Some demanded that homeowners and entrepreneurs were initiated to transcend data about flood vulnerabilities.
The last NFIP extension runs until 31 May.