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FEMA Reverses Course, Flood Insurance Program Resumes Normal Operations During Government Shutdown

Outcry Prompts Agency to Rescind Earlier Decision to Halt NFIP Sales
December 29, 2018

Late Friday Dec. 28, the Federal Emergency Management Agency (FEMA) said insurers may resume the sale, renewal, and monetary endorsements for flood insurance policies. In so doing, FEMA rescinded guidance issued two days earlier that insurers should no longer sell new policies backed by the flood insurance program during the government shutdown.

A bipartisan group of lawmakers and business groups, including PIA, quickly pressed for a reversal of FEMA’s initial decision on Dec. 26 to halt flood insurance sales. The stakeholders pointed out that FEMA’s action contradicted Congress’ passage of a six-month extension of the National Flood Insurance Program (NFIP) on the evening of Dec. 21, just hours before the government shutdown began.

David I. Maurstad, Deputy Associate Administrator for Insurance and Mitigation with FEMA, issued a statement late Dec. 28, saying:

“On December 26, 2018, FEMA informed you that due to a lapse in annual appropriation the NFIP may not sell new insurance policies, renew existing policies, or make monetary endorsements on existing policies. Effective immediately, this guidance is rescinded and NFIP Insurers may resume the sale, renewal, and monetary endorsements for flood insurance policies. Please treat the program as operational since December 21, 2018 without interruption. We appreciate your support, understanding, and patience these past few days.”

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