Skip to main content
  • Click to open or close the program search boxShow Me Programs
    • Show me the programs that are
      performing Go
    • Show me the programs that are
High Risk Issue


View Detailed Plan

National Flood Insurance Program

Problem: The National Flood Insurance Program (NFIP) is not actuarially sound because its subsidized policyholders (representing less than 25% of all policyholders, including the policyholders who are most at risk to the peril of flooding) pay less than 40% of their full risk premiums. The NFIP's enabling legislation does not permit actuarial rating of all risks. Also, the program is not structured to build loss reserves and thus does not build and hold capital to offset greater than average year losses. Instead, the NFIP pays claims and expenses out of current premium income and borrows from the Treasury when it has insufficient income to pay claims. It is very unlikely that the NFIP will be able to repay its current Treasury debt of $17.4 billion. This debt is the direct result of borrowing to pay the insured flood losses from the 2005 Hurricanes Katrina, Rita and Wilma. Claim payments for losses in 2005 equaled the total payments for all of the previous years for the NFIP.

Goal: Create a program that is more actuarially sound by gradually phasing out several categories of subsidized structures and that educates communities and citizens about the risks of flooding and mitigates future flood damage.


  • Forgive NFIP's debt and accrued interest costs from the 2005 hurricanes and bring an end to borrowing to pay the cost of debt servicing, create a reserve fund that will provide funds to pay claims in greater than historic average loss years, and increase premiums for certain classes of properties that currently receive premium discounts in order to provide more revenue to the NFIP

    • NFIP Program Oversight: Achieves legislation that would provide solutions to overcome 2005 Treasury debt, build loss reserves, and revise discounted premiums
  • Reduce or eliminate claims on SRL properties insured by the NFIP by funding cost-effective mitigation projects and provide outreach, guidance and technical assistance to applicants interested in the SRL program

    • Severe Repetitive Loss (SRL) Pilot Program: Provides SRL property owners with assistance to reduce or eliminate the risk of flooding and enables FEMA to increase flood insurance premium rates to property owners that decline mitigation assistance
  • Update and digitize flood hazard data and maps for 92% of the U.S. population and develop strong, effective partnerships with state, local, and other federal agencies

    • Flood Map Modernization: Provides a technology-based, cost-effective, long-term process for updating, maintaining, storing, and distributing the flood hazard and risk information portrayed on Flood Insurance Rate Maps (FIRMs)
The content on is developed by the U.S. Office of Management and Budget and Federal agencies.