NFIP’s authorization has been extended until September 30, 2026 through the Consolidated Appropriations Act, 2026 (H.R.7148).  H.R.7148 was signed by President Trump on February 3, after the House agreed to Senate amendments.   Although the law extends NFIP’s authorization, the package excluded Department of Homeland Security appropriations.  DHS appropriations include funding for NFIP’s activities – operating expenses and salaries, interest expenses, agents’ commissions, flood hazard mapping and risk analysis, and flood mitigation assistance.  DHS appropriations have only been extended through February 13, and lawmakers will now negotiate the full-year DHS bill; negotiations are expected to center around immigration enforcement.

NFIP lapsed over the weekend, as Congress failed to reauthorize the NFIP before its January 30 deadline.  This is NFIP’s 35^th short-term extension – and its fifth lapse – since the end of FY2017.  When NFIP lapses, its authority to issue new flood insurance policies expires.   Moreover, NFIP’s authority to borrow funds from the Treasury is reduced from $30.425 billion to $1 billion.  Once this cap is reached, claims would have to wait until sufficient premiums were collected or supplemental funds were appropriated.   The lapse occurred during Winter Storm Fern, causing governors to issue 24 emergency orders and the President to approve 12 federal emergency declarations covering nearly 900 counties, and possible resulting snowmelt claims.

The recent lapse underscores the message of CSFI’s new white paper, “Policy Options for a Natural Catastrophe Insurance Program.”  Our white paper recommends that Congress reauthorize NFIP on a multi-year basis, while formally evaluating multi-peril insurance models.  These models, which should be further assessed by a congressional commission or the Government Accountability Office, may include a federal reinsurance program, a new GSE, or an NFIP expanded to include additional perils.  As a reminder, the full paper is available on csfi.info/natcatpaper, and the executive summary can be reviewed on csfi.info/natcatsummary.   You may use our social media toolkit to share materials with your network: csfi.info/natcatsocial.