Congress Proposes Automatic Extension to Stabilize National Flood Insurance Program

Congress introduced the National Flood Insurance Program (NFIP) Automatic Extension Act of 2025 to ensure continuous operation of the NFIP despite Congressional delays in reauthorization. This bipartisan legislation allows the NFIP to issue, renew, and service flood insurance policies and pay claims even if Congress misses scheduled deadlines, extending the program's authorization through the end of the following fiscal year. The bill responds to past lapses during government shutdowns that disrupted policy renewals, issuance, and real estate transactions in flood-prone areas like Louisiana and Texas. NFIP, managed by FEMA, offers critical flood insurance coverage to homeowners and businesses, particularly in regions vulnerable to flooding and hurricanes. Frequent short-term reauthorizations have created uncertainty for policyholders, lenders, insurers, and housing markets. By guaranteeing uninterrupted NFIP operation, the act aims to maintain coverage stability and support recovery and resilience in flood-affected communities. Industry stakeholders including the Mortgage Bankers Association and United Policyholders emphasize the program's importance as a financial safety net and advocate for long-term NFIP reform. Parallel Senate legislation has been filed by Louisiana senators, supported by multiple advocacy organizations endorsing flood insurance reliability. The bill aligns with broader efforts to enhance flood resilience and insurance availability while complementing private flood insurance market development. The NFIP Automatic Extension Act addresses the operational risks posed by federal funding impasses and seeks to protect flood insurance consumers from coverage gaps and market disruptions.