It's that time of year again, when the NFIP that should have been renewed is about to expire. We see this happen repeatedly, and eventually it gets renewed for a bit only to have the same thing happen a year or two later. So what happens to coverages?

FEMA has issued guidance so companies know how to proceed. The plan will have a lapse in authority, which means the WYO companies may not issue policies for new or renewal business, or increase or add coverage to existing policies.

Requests to increase or begin coverage that are on or before the last day of effective authorization, if the carrier receives the application and payment within the lapse period and within ten days of the date of request, the policy or coverage change may be issued and effective on the requested date in accordance with standard rules. For example, the authorization lapses December 22; an application is effective December 21 and the carrier receives the application and the premium payment on December 28. Because the effective date is before the beginning of the lapse in authorization, and all is received within ten days of that date, the policy may be issued with an effective date of December 21 as long as all other eligibility requirements have been met. However, if the application or request and payment are not received within ten days of the application request date, the policy or change will not be issued.