The National Flood Insurance Program (NFIP) was created as a result of the passage of the National Flood Insurance Act of 1968. Congress enacted the NFIP primarily because flood insurance was virtually unavailable from the private insurance markets following frequent widespread flooding along the Mississippi River in the early 1960s. The NFIP is a Federal program, managed by the Federal Emergency Management Administration (FEMA), and has three components: to provide flood insurance, to improve floodplain management and to develop maps of flood hazard zones. The NFIP allows property owners in participating communities to buy insurance to protect against flood losses. Participating communities are required to establish management regulations in order to reduce future flood damages. This insurance is intended to furnish as an insurance alternative to disaster assistance and reduces the rising costs of repairing damage to buildings and their contents caused by flood. A homeowner is able to purchase excess flood insurance, but they must be covered by NFIP flood insurance first.
On July 6, 2012, the President signed into law the “Biggert-Waters Flood Insurance Reform Act of 2012,” which reauthorizes and reforms the National Flood Insurance Program for the years through September 30, 2017. Click here for a comprehensive overview.