Since our article May 8th, The Current State of Flood Insurance, the House Financial Services Committee has been reviewing bills proposed to reform the NFIP, which expires September 30th. The P/C industry's major trade associations have opposed several provisions in existing draft legislation that would revamp the NFIP. Concern stems from the belief that the current proposals will negatively impact consumers and not provide the actual reforms needed to encourage the growth of the private market as an alternative to the existing NFIP.

The Write Your Own (WYO) program is of particular concern. Eighty-six percent of all NFIP policies affecting 4.29 million insureds are written under WYO policies. Some of the proposed legislation looks to reduce WYO activity, which would decrease the very involvement of the private industry that they are looking to encourage. The WYO policies have a better claims record than policies directly under NFIP. The authors of the draft legislation claim it will add reforms that put NFIP in a better financial position, provide aid for those unable to afford coverage, improve mapping, mitigation efforts and claims handling and encourage private participation in the market.

The House Financial Services Committee has passed two bills to reform the NFIP. One seeks to encourage more private insurance and move towards actuarially sound rates, the other addresses premium credits for mitigation efforts and underwriting urban properties. The committee reconvened June 21 in order to consider additional bills to reauthorize the NFIP, which expires September 30th. The major bill was proposed by Sean Duffy, chairman of the House Financial Services Subcommittee on Housing and Insurance. This is the 21st Century Flood Reform Act of 2017. This passed, and incorporates many ideas presented in individual bills. It looks to put the NFIP on stronger footing, improve flood mapping, mitigation and claims handling and growth of the private insurer participation in the market.