Federal flood insurance program set to expire in days

By Nolan Mckendry | The Center Square

Louisiana officials and federal lawmakers are warning that a lapse in the National Flood Insurance Program could freeze real estate sales, disrupt renewals for hundreds of thousands of policyholders, and limit the federal government's ability to pay claims if a major storm strikes during peak hurricane season.

Tuesday is the deadline.

The program administered by the Federal Emergency Management Agency covers more than 4.7 million Americans – including nearly half a million in Louisiana – and has been temporarily extended 33 times over the past decade.

Without congressional action, no new policies could be issued after Monday, existing policies could not be renewed, and the program's borrowing authority from the U.S. Treasury would shrink from $30.4 billion to just $1 billion, severely restricting its ability to pay claims after disasters.

Louisiana Commissioner of Insurance Tim Temple called on Congress to pass a short-term extension, warning that the lapse would arrive "right in the middle of hurricane season."

"This will be the 34th time Congress has temporarily extended the program," Temple told The Center Square in an emailed statement. "It is vital that we identify a long-term solution that stabilizes the flood insurance market in our country."

Temple said he will raise Louisiana's concerns about affordability and transparency when he meets with FEMA's Review Council in Washington on Tuesday.

U.S. Sen. Bill Cassidy, R-La., has been one of the program's most vocal defenders, urging colleagues on the Senate floor to deliver certainty for homeowners who depend on affordable flood coverage.

"It is irresponsible for Congress to continue to make families hold their breath and hope the rug will not be pulled out from beneath them," Cassidy said. "Let's keep the National Flood Insurance Program alive – and then let's keep it strong, reliable, and worthy of the trust that millions of American families place in it every day."

Cassidy introduced legislation to extend the flood insurance program through the end of 2026. He pushed to repeal FEMA's Risk Rating 2.0 methodology, which he says has driven premiums beyond the reach of low- and middle-income homeowners.

Earlier this year, he proposed a 33% refundable tax credit to offset those rising costs.

Consumer advocates echoed those concerns, saying a lapse would deepen the nation's climate-driven insurance crisis.

"For years now, dysfunction in meeting September 30 deadlines has created uncertainty for NFIP and delays in disaster relief just as disaster season is intensifying," said Jordan Haedtler of the Insurance Fairness Project. "A lapse in the NFIP would make our climate-driven insurance and housing affordability crisis even worse."

Cassidy noted that when Hurricane Francine struck Louisiana last year, flooding caused more than $1.5 billion in damage across multiple parishes. In the months since, federal funds have been allocated for home elevations, protective measures, and resiliency projects.

"But you know what's even better than recovery? Not flooding in the first place," Cassidy said, urging Congress to maintain funding for FEMA's Building Resilient Infrastructure and Communities program, which invests in flood prevention.

With hurricane season running through November, Cassidy and Temple say letting the NFIP lapse now would be reckless.

"We've seen what happens when the waters rise," Cassidy said. "We've seen the damage, and we've seen the need. Let's act now – so that when the next storm comes, families don't have to wonder whether their coverage will be there."