The American Bankers Association (ABA) and other financial and insurance associations recently wrote to lawmakers outlining recommendations for improving the National Flood Insurance Program.
The groups based their recommendations on a set of principles geared toward enhancing the NFIP, expanding the private flood insurance market’s ability to absorb more flood risk and providing consumers more options for purchasing insurance. Congress is currently considering long-term reauthorization of the NFIP, which expires next September.
To facilitate the growth of the private market, the groups urged Congress to pass legislation to clarify the requirements for purchasing private flood insurance that satisfies federal standards, and to consider exempting large commercial loan transactions from the mandatory purchase requirement. They also called on the Federal Emergency Management Agency, which manages the NFIP, to improve its data analytics, update its flood mapping information and provide updated guidance on compliance requirements.
With respect to improving the operation of the NFIP, the trades said that FEMA should focus on enhancing the customer experience through better disclosures, more policyholder education, and simplified underwriting and claims handling. While they noted that the majority of these actions may be taken without congressional action, the groups urged Congress to use its oversight authority to ensure FEMA is responsive to the concerns of taxpayers, policyholders and its private sector partners. For more information, contact ABA’s Joe Pigg.
Source: ABA Banking Journal