R Street Institute Testifies Before Senate Banking Committee on National Flood Insurance Program

Link: https://www.rstreet.org/2022/06/16/r-street-institute-testifies-before-senate-banking-committee-on-national-flood-insurance-program/


Additional link: https://www.rstreet.org/2022/06/16/five-solutions-to-help-fix-the-national-flood-insurance-program-from-r-street-testimony-to-the-u-s-senate-banking-housing-and-urban-affairs-committee/


Regarding the second objective, there is no equitable sharing of costs between the public and private sectors. The private sector is only peripherally involved in bearing flood risk. The involvement of the private insurance sector is restricted to administration of the program, for which insurers are remunerated by the NFIP. The participation of private insurers in flood insurance as a risk-bearer is de minimis, writing less than a tenth the premium collected by the NFIP.

Instead of attaining the overarching goal of reducing economic losses caused by flooding, flood-
related economic losses have increased. In the past decade, U.S. economic losses caused by flooding were $943 billion, close to five times more than the $211 billion cumulative flood-related losses in the prior decade. In this testimony, we highlight five issues standing in the way of the NFIP falling short of achieving its mission, and propose solutions to remedy those problem areas.

Author(s): Jerry Theodorou

Publication Date: 16 June 2022

Publication Site: R Street Institute