Editorial: Congress Must Extend Flood Insurance Program
The program, which has seen numerous short-term extensions over recent years, is in need of reform to allow it to find firmer financial footing. As it now stands, the program is deep in debt, the result of paying out billions more in claims than it has received in premiums.
A new bipartisan effort would extend the program, giving at least temporary peace of mind to the many in Louisiana and across the nation who depend on it to protect their homes, their largest investments.
Republican Sens. Bill Cassidy and John Kennedy were joined by Bob Menendez, D-New Jersey; Cory Booker D-New Jersey; Chris Van Hollen, D-Maryland; Marco Rubio, R-Florida; Elizabeth Warren, D-Massachusetts; and Kirsten Gillibrand, D-New York.
“The reforms in this bill are critical to any reauthorization effort to make the program sustainable and prevent families from being hit with drastic premium increases,” Cassidy said.
Kennedy, too, expressed his support.
“I think this bill strikes a fair balance between the financial integrity of the National Flood Insurance Program and affordability for policyholders,” he said. “It doesn’t do any good to offer flood insurance to people if they can’t afford it, and that’s certainly not going to make the program stabler if you don’t have any policyholders.”
The bipartisan nature of the support for this bill will be crucial in guiding it through both houses of Congress and receiving the signature of President Donald Trump.
The problems plaguing the system are that too few people carry the insurance and pay into it through premiums and that it pays lucrative incentives to insurance companies that sign policyholders but carry none of the financial risk.
Congress should be able to take simple actions that make the banks and insurance companies issuing federally backed loans to enforce the requirement that loan holders carry flood insurance on property in flood-prone areas. It should also be able to scale back the percentage paid to insurance companies that are doing little more than repetitive paperwork.
Let’s hope this extension effort — which has met with approval from both parties — can garner the support of the House and Senate. And let’s hope it’s just the beginning of the real reforms that are needed to make the program viable for years into the future.
Editorials represent the opinion of the newspaper, not of any individual.