The National Flood Insurance Program (NFIP) was refunded until December 20, after it was originally set to expire on November 21. Industry experts have praised the extension, but expressed disappointment in the short-term extension, and in Insurance Business Magazine, John Dickson, CEO and President of private flood insurance provider Aon Edge called the recent extension “head-scratching.”
Says Dickson, “I think the issues that this Congress are dealing with are well publicized and they’re huge-headline, all-encompassing topics, and for you as a working body to know that you’ve got quite a lot on your plate and you’re working around the clock, your staff is fully engaged with these other issues, to then move a program of critical importance out 30 days in time, and I think that’s being generous by maybe a day, knowing that you are now with the holidays in the states scheduled to work maybe 10 to 15 of those 30 days, to think you’re going to get your business done and get reforms passed in that period of time is nonsensical. You know you can’t do it, so this is probably the most head-scratching extension that I’ve seen in this litany of non-stop short-term extensions.”
Dickson adds that the NFIP hasn’t been transparent in what Risk Rating 2.0 will actually look like yet, which he notes is “troubling,” going on to note the growing importance of flood insurance as storm risk increases.
“What we’re seeing today is flooding intensity that you never had before,” said Dickson. “Whether or not you believe that the climate is changing due to acts of man, if you believe that air temperatures are gradually or rapidly warming, then we have a situation where we will have bigger rain events with more lasting, more torrential rainfall. What’s happened this year with the Midwest and with Imelda is not much far removed from Michael, Florence, East Baton Rouge, Hurricane Harvey, they’re very similar in the fact that the intensity of these events is increasing.”
A full vote for the NFIP extension is expected soon.