National Flood Insurance Program getting short-term extension

The United States Senate has approved a three-month extension of the National Flood Insurance Program, which expired on May 31 in the midst of the Midwestern flood season.

The short three-month extension was not satisfactory to a leading insurance industry association.

“We are pleased that Congress reauthorized the flood insurance program,” said David Sampson, president and CEO of the Property Casualty Insurers Association of America. “But this three-month extension threatens to leave communities vulnerable again in September, at the height of hurricane season.”

Congress failed to extend the National Flood Insurance Program before leaving for the Memorial Day recess. The expiration, among other things, prevented some Americans seeking to buy homes in flood-prone areas from consummating their purchases, because they are required to have flood insurance.

State Farm Fire & Casualty announced it planned to stop servicing National Flood Insurance Program polices in May. It said the 11 last-minute reauthorizations and four lapses in the program since 2002 had made it too burdensome to keep customers abreast of the program's status.

The National Flood Insurance Program provides 5.5 million Americans with financial protection from flooding.

The insurance association said that the program has $18 billion in debt, and needs meaningful reform rather than short-term extensions.

The group supports a bill introduced by U.S. Rep. Maxine Waters, D-Calif., that it said would provide a five-year extension, stabilize the program financially, and limit additional federal exposure to natural disasters.

Realtors in the Cedar Rapids and Iowa City areas said they did not believe the recent lapse in the program interfered with many home purchases.