Flood Insurance up for Reauthorization September 2017

As you may recall, the LBA was a very active part of a coalition in 2014 that successfully worked to amend the seriously flawed Biggert-Waters renewal of 2012. The Coalition for Sustainable Flood Insurance, found at http://csfi.info/, is a group of over 700 organizations and individuals from 37 states, including 19 state banker associations. I am working to get more state bankers associations involved. You can be a part of this coalition by clicking on the link above and signing up, there is no cost. You will receive email updates and material as well as call-in information for periodic conference calls. I am very impressed with this coalition and it will be a force in the NFIP debate. The Louisiana congressional delegation will be the energy and driving force to get a reauthorization that keeps availability and affordability in the forefront. This is critical for our state and the communities that you and your customers live in, as well as the bank. With hurricane Matthew hitting the east coast, the lessons of a well-run NFIP that is focused on local flood mitigation efforts and providing flood insurance that is available and affordable will add voices to this debate.

The LBA has recently conducted a member survey on a few issues. There were several questions on flood insurance, one being ‘Do you have confidence when making a loan that the flood mapping you depend on is accurate and protects the safety and soundness of your bank?’ The results are stunning to me, with 69% answering NO and 31% answering YES. This result is likely related to the many ‘rain events’ Louisiana has had this year and that many who flooded were not in a special flood hazard area. The same apparently happened with hurricane Matthew. Flood maps do not accurately predict where the flooding will occur and customers believe that not being required to purchase flood insurance means they don’t need to be concerned about flooding. One clear lesson, being learned again, is that more people need to buy flood insurance whether in a flood hazard area or not. I spoke with Sen. Bill Cassidy on October 12 about reauthorization and the idea of incentivizing people to purchase flood insurance, as well as the mapping not being predictive of flooding. We will meet with Congressmen Steve Scalise and Garret Graves over the next few weeks on these issues and are seeking thoughts from bankers on what changes to NFIP could be considered by our congressional delegation. If you want to take the survey, email me at taylor@lba.org and I will send the link. If you have thought on changes to NFIP, let me know.