National Flood Insurance Extended for Five Years

The extension of the National Flood Insurance Program (NFIP) is a multifaceted victory for homeowners, businesses, banks, and real estate professionals. This brings certainty to the areas throughout the nation where coverage is necessary to obtain a mortgage.

The Surface Transportation Bill (H.R. 4348) included the specifications necessary to reauthorize NFIP through 2017. President Obama signed the bill into law on July 6, 2012. Reforms to NFIP include:

  • Multifamily properties: insurance available to cover residential properties of 5 or more residences (Section 100204)
  • Repetitive loss: eliminates properties from receiving coverage multiple times (Section 100205)
  • Repayment Plan: funds borrowed will have a repayment plan beginning six months after funds are borrowed with reports on progress to full repayment (Section 100213)
  • Floodplain maps: improved accuracy with technical expertise leadership (Section 100215)
  • Research: coverage on business interruption and additional living expenses, report on building codes and floodplain management (Sections 100233 and 100235)
  • Flood Loss Allocation Formula: establishes by rule a standard formula to determine and allocate wind and flood losses to avoid complicated lawsuits (Section 100253)