The National Flood Insurance Program (NFIP), which provides critical insurance coverage to those at risk, is up for reauthorization this year. The program must be reauthorized and reformed to ensure it is financially sustainable, that there are sufficient incentives for reducing future flood damages and vulnerabilities, that it provides better protection for taxpayers who have repeatedly backstopped the program, and that it better protects the environment and promotes the use of nature-based mitigation solutions.

While NFIP provides needed insurance coverage, it has numerous problems as currently constructed – it was not designed to accommodate major catastrophic events; it fails to adequately deter new development in areas vulnerable to flooding thus leading to further environmental degradation and additional financial losses; and it does not do enough to encourage states, communities, and individuals to reduce their vulnerability to floods. The NFIP must be reformed to address these issues — to provide increased transparency to the public, provide more information to people living in harm’s way about past damages and the risk of flooding, to ensure mapping is timely and accurate, to tie rates to risk, to give consumers greater choice in flood insurance options, and to incentivize mitigation and risk reduction.

It is important that Congress lay out an updated vision for NFIP that includes managing the nation’s escalating flood risks, reducing those risks over the long-term, promoting environmental stewardship, and easing the financial burden for flood risk now borne by the federal taxpayers.  Toward these ends, any reauthorization of NFIP should prioritize the following:

Helping those in Harm’s Way Understand and Plan for Risk—More Accurate Mapping and Rates

For too many years, federal policies—and discounted flood rates that bear no relation to the potential for flood damages—have masked risk and encouraged development in unsafe and environmentally sensitive areas. SmarterSafer urges Congress to make a number of changes to mapping to ensure people understand and can prepare for known risks.

FEMA’s Flood Insurance Rate Maps, also known as flood maps or FIRMs, are an essential component of NFIP and the nation’s ability to manage the potential for flood damages. These maps serve two main purposes:

  1. to establish the risk of flooding at a given location and the commensurate flood insurance rates a property owner is required to pay, based on the location of an individual parcel of land and the structure’s elevation relative to the mapped floodplains; and
  2. to provide the public and decision makers with the best available information on flood risks to guide decisions related to development, project design, siting and local land use decisions, and  enforcement of provisions of the NFIP.

To ensure that maps are accurate and inform property owners, government officials, and the public at large, SmarterSafer urges Congress to make revisions to FEMA’s mapping requirements. Many of these recommendations are consistent with those of FEMA’s own Technical Mapping Advisory Council.

To help people understand their risk and to ensure proper NFIP rates, maps must be up-to- date and accurate, and property elevations (or effective proxies) must be known.  Private companies already perform assessments of risk to individual properties—something that is not currently reflected in FEMA maps.  FEMA must be required to update its maps, include the best science on known conditions and risks, but also conduct (or purchase) property level (or close to) risk assessments. The government must continue to map for purposes of the Special Flood Hazard Area designation (which triggers mandatory purchase requirements); however, this is not enough.  FEMA should be required to assess elevation at a higher resolution or conduct more granular risk analysis.

Proposal on new mapping data. Rather than expending federal funds to digitize outdated flood maps FEMA should instead use some portion of these funds to procure new data and investigate the use of new modeling and risk analysis information currently being used in the private and public sectors. An emphasis should be put on accessing data that can be used to determine elevation in the highest risk areas.

Proposal on Mapping Council. FEMA’s Technical Mapping Advisory Council (TMAC) has worked to establish guidelines for more accurate mapping. SmarterSafer supports the continuance of TMAC and recommends the following:

Tying Rates to Risk and Supporting Mitigation

Rates for flood insurance should accurately reflect risk. As a result of past reforms, NFIP is already moving towards insurance rates that more accurately reflect the risks faced by many, but not all, policyholders. Reauthorization should complete the shift toward risk-based rates while ensuring affordable access to coverage for low-income policy holders. Those already on the economic margins may not be able to afford risk-based rates, and assistance for these low-income property owners may be needed.  One way to help low-income property owners in harm’s way is to provide them with resources to mitigate flood risk, rather than simply providing rate subsidies.

In addition, information about risk must be transparent and provided to property owners. Households and communities should use the information provided by accurate insurance rates and past flood events to make changes that reduce their risk.  Federal, state, and local assistance should help them to do so through cost-benefit analysis, support for up-front investment to relocate or renovate homes to make them safer from floods, and support for nature-based, community-level mitigation efforts.

Proposal on Rates and Mitigation As part of NFIP reauthorization, Congress and FEMA should cushion the adjustment to accurate flood insurance rates for low-income policyholders and encourage mitigation actions that lower risk and costs for property owners and communities.  We recommend these steps to connect affordability and mitigation:

Expanded Role for Private Insurers

The move to a system in which both the private sector and NFIP write flood insurance will provide consumer choice and ensure competition and innovation, while maximizing the number of properties covered by flood insurance.  As people choose to purchase in the private sector, however, FEMA would continue to have a clear mandate to provide maps for mandatory purchase, establish minimum floodplain standards, and focus efforts on mitigation and resiliency assistance to reduce risk at the household and community levels in cost-effective ways.  As more properties move to the private sector, NFIP would be able focus its mitigation efforts on the most at-risk properties. It is critical that mitigation and resiliency be elevated as part of NFIP’s mission, as well as through disaster assistance reforms.

Private companies are poised to write flood risk, and some already have started to write flood risk in the United Sates. To ensure there is a level playing field, Congress must clarify that private flood insurance counts for purposes of mandatory purchase—no property owner should be forced to purchase from NFIP or any particular insurer.  Consumers should have choice and should be able to choose policies that meet their needs and are not one-size-fits-all, like NFIP. This means private companies must be able to innovate and offer different coverages, limits, and deductibles. In addition, to reduce taxpayer liability, FEMA should continue to look for ways to transfer risk to the private sector, like through reinsurance purchase.

Proposal on Private Insurance.

Proposal on Other Private Sector Involvement. To better protect taxpayers and minimize the federal government’s risk, the private sector could take risk directly from NFIP.  This means:

Encourage More People to Purchase Flood Insurance

A significant amount of flooding occurs outside of the ‘100 year floodplain’ or the Special Flood Hazard Area (SFHA). Estimates are that 20% of NFIP claims overall and 17% of severe repetitive loss properties reside outside the mapped 100-year floodplain–those areas where purchase of flood insurance is mandatory for properties with federally backed mortgages. It is clear that flood waters do not stop for a line drawn on a map, and additional property owners should be purchasing flood insurance—whether through the NFIP or through private policies.  Since standard homeowners’ insurance policies do not cover flood, homeowners are often surprised to learn they have no insurance. Though there is federal disaster assistance provided many times, the amount per property is usually not enough to rebuild, much less to reduce future risk.

Property owners and prospective owners must be provided better information on risk so they can make decisions about purchasing flood insurance and resiliency. FEMA should be required to provide information about a property’s history of flooding so that homeowners can make informed decisions about the need for flood insurance or the need to take mitigation actions.  Providing actual flood history of a home could help buyers and owners understand the importance of getting and maintaining coverage year to year.

Proposal on Expansion of Flood Insurance Purchase.

Proposal on Increased Transparency.

Focus on Resiliency— FEMA’s focus should be on mitigation and protecting those in harm’s way.  SmarterSafer has recommended a sliding scale for disaster assistance as a way to incentivize communities to become more resilient. This should be coupled with changes to NFIP to build resiliency.

FEMA should look at mechanisms that encourage high-risk policy holders to consider relocating, or that provide incentives for taking mitigation actions that will protect their property from flood damage over the long term.  It is also essential that means be developed to allow such relocations to take place on a much more timely basis. Currently, many distressed homeowners can be held up for years waiting for the necessary assistance.

Resiliency Proposals for Individuals.

Resiliency Proposals for Communities/Nature Based Approaches.

Public policy should include incentives for nature based resilience. Communities or properties at risk from severe weather, storm surge, flooding, and other hazards, can undertake a variety of community wide approaches that make use of natural features, or those that emulate them with human-engineered features. Natural or nature based approaches such as protecting or restoring wetlands, berms, forests and natural floodplains can be as, or more, cost-effective as traditional man-made flood reduction structures. In addition, these approaches provide numerous additional benefits including improved water quality, public open space and wildlife habitat. Whenever possible, the NFIP should encourage and incentivize this type of mitigation to better protect people and properties and to reduce flood insurance premiums

Congress should encourage enrollment and participation in the voluntary Community Rating System and should strengthen the program’s requirements to focus on non-structural mitigation and simplify administrative burdens. In addition, SmarterSafer has recommended a series of changes in disaster assistance to only provide maximum federal disaster assistance if states and communities are planning for and mitigating for known risks.


Data Transparency

FEMA has a vast amount of information on flood damages, NFIP claims and policies, properties that have been repeatedly damaged, compliance of communities with NFIP provisions, and communities’ actions under the Community Rating System.  Unfortunately, relatively little of this data is available to the public.

Congress should direct FEMA to make all data publicly available while still protecting private individuals’ right to privacy under the Privacy Act.  FEMA should release data that includes at least ZIP code resolution data that includes the following:

SmarterSafer is a broad-based, diverse coalition of taxpayer advocates, environmental groups, insurance industry representatives, housing groups and mitigation interests that supports environmentally responsible, fiscally sound approaches to natural catastrophe policy that promotes public safety and encourages resiliency. A list of members and further information can be found at

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