National Flood Insurance Program Set To Expire - 5/31/10
If you know anyone buying or selling a house, this is urgent information that they need to know ASAP. If it pertains to people in the League City, Friendswood, Clear Lake or surrounding areas, have them call The Brian Worrell Team for further assistance, 281-948-7042.
It appears that Congress will be adjourning without passing a bill that will reauthorize the National Flood Insurance Program (NFIP) beyond May 31, 2010. This means that the program WILL EXPIRE at midnight on May 31, 2010.
The Senate is not due to vote on the bill to extend the NFIP until at least Monday, June 7, 2010. This means we will be faced with another lapse in statutory authority to issue or renew flood insurance policies pursuant to the NFIP. Based on past experience, this lapse means that we will be unable to issue any new or renewal flood policies, or make coverage changes on existing flood policies after May 31, 2010.
PLEASE NOTE – In order for New Business, Renewals or policy changes to be effective, payment MUST be received your insurance company before midnight May 31, 2010.
FEMA has advised us to pend premium transactions received after May 31, 2010, until, and if, Congress and President Obama pass and sign the bill that re-authorizes the NFIP. New and renewal policies or coverage changes will go into effect at the earliest date, which is consistent with the receipt of premium and waiting period rules of the NFIP and the expected extension of authority for the NFIP. For applications made in connection with a mortgage loan, if the extension of the authority to issue flood insurance policies under the NFIP is granted retroactively, new policies will be issued effective as of the date of the loan closing. Additionally, if Congressional extension is granted retroactively, any claim for insurable losses suffered from the effective date for the policy term will be honored by the NFIP, even if the authority is granted after the date of such losses.
Please note that policies or coverage changes will only be effective if the extended authorization of the NFIP becomes law, which is expected. If Congressional extension is not granted within a reasonable period, premiums will be refunded. In this event, the requested coverage will not go into effect and no coverage will be afforded.
If you have any questions regarding this issue, please feel free to call the Flood Service Center at 800.356.6670, or the Flood Marketing office at 800.713.3566.
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