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PIA Statement on FEMA Guidance on NFIP During Shutdown

FEMA’s Decision to Halt Some Operations of NFIP After Congress Passed a Six-Month Renewal Blasted by Industry, Lawmakers
December 27, 2018

WASHINGTON —On December 26th, five days after Congress extended the National Flood Insurance Program (NFIP), avoiding a lapse during the partial federal government shutdown, the Federal Emergency Management Agency (FEMA) notified stakeholders that, despite Congress’s action, the NFIP cannot function normally.

FEMA's guidance notes that, during the shutdown, independent agents cannot sell or renew NFIP policies because doing so would cause the government to "incur obligation without an appropriation" because the Department of Homeland Security (DHS), which houses FEMA and the NFIP, does not have appropriation as part of the partial shutdown.

"This guidance from FEMA means millions of people are at risk of economic disaster because they cannot purchase, renew, or add to policies," said Jon Gentile, vice president of Government Relations of PIA National. “Congress and the administration need to come to the table immediately to rectify this by ensuring the NFIP can operate normally."

According to FEMA, NFIP insurers may continue to service new and existing claims on active policies and to examine and pay claims in accordance with the terms and conditions of the Standard Flood Insurance Policy. FEMA is expected to issue a related bulletin concerning permitted and prohibited activities.

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