At the end of July, President Donald Trump signed a four-month extension of the National Flood Insurance Program, a critically important support for Florida homeowners who have or will go through a hurricane season. The program was due to expire at midnight upon the end of the month, but both houses of Congress approved the extension on the last day before the President's signature. This is the seventh short-term reauthorization for the program, which is struggling to survive amid challenges about the costs.
The program allows people to obtain flood insurance policies and renew expired coverage. It provides coverage to 5 million homeowners and businesses across the country, and nearly 2 million of those are in Florida. The program owes over $20 billion to the federal treasury, even though it received a cash injection of $16 billion in 2017. Some have argued that the program is unsustainable and encourages further building in areas prone to flooding, saying that insurance policies should be more costly. Other criticisms of the program have said that it encourages rebuilding of damaged homes on flood-prone land rather than relocation.
Another coalition of groups, SmarterSafer, urged reforms that would encourage private insurance companies to enter the market, as most people only obtain flood insurance from the federal government. Some Florida representatives are behind a long-term extension with capped premium increases in order to encourage homeowners to purchase insurance through the program. Previous reforms have driven premiums upward, causing a downturn in the Florida housing market, before they were reversed.
When major storms come through South Florida, homeowners pay the price. Aside from the issues troubling federal flood insurance, private insurance companies may hesitate to live up to their coverage obligations. People who are facing insurance denials can work with lawyers to take legal action to receive compensation for the storm damage to their homes.