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1 1 (March 21, 2025)

handle is hein.crs/nnlfldice0001 and id is 1 raw text is: Congressional aResearch Service ~~~ ~~informing the legislative debate since 1914___________________ National Flood Insurance Program Borrowing Authority Updated March 21, 2025 This Insight evaluates the National Flood Insurance Program (NFIP) borrowing authority to receive loans from the Treasury and the current financial situation of the NFIP. On February 10, 2025, the NFIP borrowed $2 billion to pay NFIP claims. The debt is now $22.525 billion, with $7.9 billion of remaining borrowing authority. NFIP Funding Funding for the NFIP is primarily maintained in an authorized account called the National Flood Insurance Fund (NFIF). The NFIP is funded from receipts from the premiums of flood insurance policies, including fees and surcharges; direct annual appropriations for specific costs of the NFIP (only for flood mapping); and borrowing from Treasury when the NFIF's balance has been insufficient to pay the NFIP's obligations (e.g., insurance claims). Since the end of FY2017, 33 short-term NFIP reauthorizations have been enacted. The current reauthorization is set to expire on September 30, 2025. These extensions did not increase the NFIP's borrowing limit or provide additional funds to the NFIP. As of January 27, 2025, the NFIP had $615 million available to pay claims, with claims for Hurricane Helene of more than $4.5 billion and claims for Hurricane Milton of $740 million. FEMA estimates that claims for Hurricane Helene will be between $6.4 and $7.4 billion, with claims for Hurricane Milton between $1.2 and $2.9 billion. NFIP Borrowing Authority The NFIP was not designed to retain funding to cover claims for truly extreme events; instead, the National Flood Insurance Act of 1968 allows the program to borrow money from Treasury for such events. For most of the NFIP's history, the program has been able to cover its costs, borrowing relatively small amounts from Treasury to pay claims and to repay the loans with interest. Only current and future participants in the NFIP are responsible for repaying NFIP debt, as the insurance program itself owes the debt to Treasury and pays for accruing interest on that debt through the premium revenues of Congressional Research Service https://crsreports.congress.gov IN10784 CRS INSIGHT Prepared for Members and Committees of Congress

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