CounterPunch Exclusives

CounterPunch Exclusives

Protect the National Flood Insurance Program’s Community Rating System

Pudding River in flood, near Mt. Angel, Oregon. Photo: Jeffrey St. Clair.

With the Federal Emergency Management Agency (FEMA) Review Council’s final recommendations finally available, one particular recommendation stands out.  In the section titled, “Shift to Private Market through Depopulation of Existing National Flood Insurance Program (NFIP) Policies,” the council recommends establishing a voluntary “take-out” program that would transfer eligible policies to private insurers — similar to what states like Florida and Louisiana call depopulation programs. There is also a recommendation for a flood insurance marketplace, similar to the Affordable Care Act health insurance marketplace, that would allow private insurers an opportunity to offer coverage to consumers before they consider the NFIP.

There are many issues with these recommendations, especially for high-risk states like Florida, where private insurance is more expensive than NFIP policies and risk-averse companies have been pulling out of the state. But one glaring issue with the report is that the council makes no mention of the Community Rating System (CRS) and how a voluntary “take-out” program would affect it.

To be covered by an NFIP flood insurance policy, a property must be located in a community participating in the NFIP. Currently, over 22,300 communities across the US........

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