The Government Shutdown and NFIP

From time to time the government reaches an impasse and shuts down. When the government shuts down several governmental agencies do as well, resulting in employee furloughs,  cessation of benefits such as WIC and SNAP, and members of the military and others working without pay and other issues. The NFIP is one of those agencies that will shut down, leading to several issues.  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 is on or before the last day of effective authorization, if the carrier receives the application and payment within the lapse period and within 10 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 September 30; an application is effective September 29 and the carrier receives the application and the premium payment on October 5. Because the effective date is before the beginning of the lapse in authorization, and all is received within 10 days of that date, the policy may be issued with an effective date of September 29 as long as all other eligibility requirements have been met. However, if the application or request and payment are not received within 10 days of the application request date, the policy or change will not be issued.