National Flood Insurance Act of 1968

The National Flood Insurance Act of 1968 is a piece of legislation passed in the United States that led to the creation of the National Flood Insurance Program (NFIP).

The act was motivated by a long history of property damage and loss of life due to flooding. The legislation was finally promulgated because of the recent flood loss sustained in Florida and Louisiana following the destruction caused by the Hurricane Betsy flood surge in 1965.

The NFIP goals are two-fold:

• To provide flood insurance for structures and contents in communities that adopt and enforce an ordinance outlining minimal floodplain management standards.
• To identify areas of high and low flood hazard and establish flood insurance rates for structures inside each flood hazard area.

The program was first amended by the Flood Disaster Protection Act of 1973, which made the purchase of flood insurance mandatory for the protection of property within SFHAs. In 1982, the Act was amended by the Coastal Barrier Resources Act (CBRA). The CBRA enacted a set of maps depicting the John H. Chafee Coastal Barrier Resources System (CBRS) in which federal flood insurance is unavailable for new or significantly improved structures. The National Flood Insurance Reform Act of 1994 codified the Community Rating System (an incentive program that encourages communities to exceed the minimal federal requirements for development within floodplains) within the NFIP. The program was further amended by the Flood Insurance Reform Act of 2004, with the goal of reducing "losses to properties for which repetitive flood insurance claim payments have been made." More specifically, FIRA authorized FEMA to offer assistance in the buyout of Severe Repetitive Loss Properties to willing sellers and impose premium hikes on those that refused.

The Biggert–Waters Flood Insurance Reform Act of 2012 was "designed to allow premiums to rise to reflect the true risk of living in high-flood areas." The bill was supposed to deal with the increasing debt of the National Flood Insurance Program by requiring the premiums to reflect real flood risks. The result was a 10 fold increase in premiums. At present, $527 billion worth of property is in the coastal floodplain. The federal government heavily underwrites the flood insurance rates for theses areas. The law "ordered FEMA to stop subsidizing flood insurance for second homes and businesses, and for properties that had been swamped multiple times." These changes were to occur gradually over the course of five years. FEMA was also instructed to do a study on the affordability of this process, a study which it has failed to complete.

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