In 1968, the National Flood Insurance Act created the Federal Insurance Administration and made flood insurance available for the first time to homeowners and businesses. In 1973, Congress made the purchase of flood insurance mandatory for the protection of property located in Special Flood Hazard Areas.

The original legislation made providing federal flood insurance a priority for “residential properties which are designed for the occupancy of from one to four families, church properties and business properties which are owned or leased and operated by small business concerns.”

It gave the director the authority to determine if federal flood insurance could or would be extended to other types of properties.

The National Flood Insurance Program (NFIP) is managed by the Federal Emergency Management Agency (FEMA).

The 1968 legislation set three areas of responsibility for the Federal Insurance Administration:

o Provide flood insurance

o Improve flood plain management

o Develop maps of flood hazard areas

Authorization of and funding for the NFIP must be done by Congress. Congress can choose to authorize the NFIP for any period of time. Authorization has been extended at least 14 times since September 2017. If an extension is not made, then NFIP would not be able to write new flood insurance policies.

Congress has chosen to extend authorization of NFIP in limited increments as work progresses on a re-write of the National Flood Insurance Act or replacement legislation.

There is no indication when that work might be completed.

Despite the lack of new legislation, FEMA continues, through the NFIP, to provide flood insurance, work on flood plain management and develop new flood maps.

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