Yesterday, we blogged that if Congress didn’t vote on it today, the federal flood insurance program would lapse (again) as would some unemployment benefits. The Insurance Journal is reporting that Congress could not come to agreement on the bill, and adjourned without passing it.
Congress will be in recess until April 12th.
As a result of the bill not passing, the National Flood Insurance Progam will lapse on Sunday, March 28th at midnight, and from that point until Congress returns to vote in mid-April, insurance agents will be unable to sell new or renewal flood insurance policies, which are required by lenders to close loans on properties lying in certain flood hazard zones.
The Senate’s vote on the bill was blocked by Senator Tom Coburn (R – OK) who argued that voting to extend jobless benefits (part of the same bill) would add to the deficit. Senate Democrats countered with the assertion that this was emergency spending.
This marks the second lapse of the NFIP this year, but last month’s lapse was only a few days; this one will be roughly two weeks, and that’s assuming there is a vote on the day Congress reassembles. If that happens, Congress can reinstate the program retroactively.
It is important to remember that while new policies and renewals cannot be processed, currently insured homeowners remain covered, and claims payments will not be affected.