By Jason Stverak
Congress faces a looming Sept. 30 deadline to reauthorize the National Flood Insurance Program (NFIP), which insures millions of American homes in flood zones. In a pattern all too familiar, lawmakers appear poised to approve yet another short-term extension rather than a long-term solution. This cycle of last-minute patches must end.
A permanent fix to the NFIP isn’t just a bureaucratic nicety—it’s an urgent necessity for homeowners, lenders, and especially military families who move frequently and need stability in the housing market. As the chief advocacy officer of the Defense Credit Union Council (DCUC), representing credit unions serving nearly 40-million servicemembers, veterans, and their families, I hear firsthand how vital flood insurance is to community resilience. It’s time for Congress to provide certainty and security by reforming and reauthorizing the NFIP for the long haul.
A Looming Deadline with Real Stakes
If Congress fails to act by the end of September, the NFIP will lapse. The consequences of even a brief lapse are stark. Lenders cannot originate or close mortgages on homes in FEMA-designated flood zones without flood insurance in place. According to the National Association of Realtors, an NFIP shutdown could stall roughly 1,300 home sales per day across the country.
Historical episodes prove the point: when the program briefly lapsed in June 2010, over 40,000 closings were delayed or canceled per month. Each delayed home sale represents a family’s life on hold and a community’s real estate market frozen. Without NFIP coverage, borrowers in flood-prone areas could be left without recourse to rebuild after disasters, and lenders would shoulder greater risk or stop lending altogether. In short, allowing the NFIP to lapse – even temporarily – would wreak economic havoc on housing markets in coastal and riverine communities.
Beyond the numbers are human stories. Credit unions, including those on military bases, report that uncertainty around flood insurance already chills homebuying and investment in at-risk areas. The mere prospect of a program lapse can leave neighborhoods in limbo, as buyers, sellers, and financial institutions await Congress’s next move. This uncertainty is untenable for communities that depend on affordable flood coverage for peace of mind. Americans deserve better than a recurring threat of lost insurance protection. They deserve a Congress with the foresight to keep this lifeline intact.
Military Families Caught in the Middle
Frequent relocation is a fact of life for servicemembers. Every few years, military families receive Permanent Change of Station (PCS) orders, giving them only a short window to sell their current home and find a new one. In this tenuous period, any disruption to flood insurance can turn a stressful move into a financial crisis. DCUC-member credit unions serve many base communities in coastal and flood-prone regions.
We’ve seen what happens when a family gets orders to a base in Florida, Louisiana, or coastal Carolina: they list their home and put in an offer on another, only to learn an NFIP lapse may prevent the sale from closing. Even temporary uncertainty about flood coverage can derail home sales or force military families to carry two mortgages or rent payments simultaneously.
For a military family on a tight timeline, a delayed closing due to insurance issues isn’t just an inconvenience—it can jeopardize their financial stability and the servicemember’s focus on the mission.
‘Especially Vital’
As DCUC President/CEO Anthony Hernandez aptly noted, “For military families undergoing PCS moves, the NFIP’s continuity is especially vital”. An interruption in coverage could delay home purchases or sales during a relocation, forcing families into financial hardship. Stable housing is more than a quality-of-life issue; it directly affects mission readiness and family resilience. When a sailor or soldier is worried that their family is stuck in limbo because a home sale fell through—or that they can’t afford a new home due to spiking insurance costs—that distraction follows them to the front lines.
Stable, affordable housing isn’t a luxury for service members – it’s a direct contributor to mission readiness and long-term economic security. Thus, ensuring continuous access to flood insurance, especially during PCS transitions, is part and parcel of supporting our troops and their loved ones. Congress must remember the unique sacrifices of military families and safeguard them from avoidable housing disruptions by keeping flood insurance available and affordable during moves and beyond.
End the Cycle of Stopgap Extensions
It has been over 8 years since the NFIP had a full multi-year reauthorization from Congress. Since 2017, the program has been propped up by 25+ short-term extensions, often passed in the 11th hour to avert a lapse. This legislative ping-pong creates recurring uncertainty for insurers, lenders, and homeowners. Imagine trying to run an insurance program – or plan your household’s finances – knowing your authorization might expire every few months.
The current approach is inefficient and irresponsible. Every time Congress kicks the can down the road, it undermines confidence in the flood insurance marketplace. Borrowers can’t be sure their coverage will remain in force; banks and credit unions can’t be sure if loans in flood zones will close; and communities rebuilding from floods can’t be sure federal support will be there next time.
A long-term reauthorization would provide certainty to all stakeholders and eliminate the periodic threat of lapse that has hung over the housing market for years. It would also give the NFIP itself a stable horizon to manage its finances and invest in improvements. The DCUC and the entire credit union industry have long advocated moving past these stopgaps to a lasting solution for the NFIP. We commend the many lawmakers on both sides of the aisle who agree; indeed, there has traditionally been broad bipartisan support for keeping the NFIP running and solvent.
Now, with climate-driven disasters worsening and the private insurance market in turmoil in many states, it’s more important than ever to break the cycle of inaction. Congress should seize this moment to authorize the NFIP for the long term and end the constant cliffhangers.
Reforming NFIP for Affordability and Resilience
Reauthorizing the NFIP permanently or for multiple years should go hand-in-hand with common-sense reforms to put the program on a stronger footing. The NFIP is a lifeline for millions, but it is also financially strained by repeated $1-billion-plus disasters and outdated policies. Any long-term legislation needs to tackle the challenge of making the NFIP fiscally sound without pricing out the very homeowners it is meant to protect. That is a delicate balance, but it’s achievable with political will and smart policy.
These reforms would help foster a more sustainable flood insurance system for the long run. Importantly, they would encourage more private insurance capacity to enter the market alongside the NFIP by making the market more predictable and risk-informed. When the NFIP is on solid footing, private insurers are more likely to offer supplemental or even alternative flood policies, giving consumers more choices. Ultimately, a healthier mix of public and private involvement – guided by improved data and mitigation – can ensure that every homeowner in a flood zone can obtain insurance at a reasonable cost. We support legislative efforts to strengthen the NFIP’s finances and infrastructure (better maps, smarter incentives) without losing sight of affordability for policyholders.
Getting that balance right is critical: if premiums skyrocket unpredictably, homeowners will drop coverage, undermining the entire program. Congress must therefore calibrate reforms carefully, in consultation with experts and stakeholders, to keep flood insurance both available and affordable.
A Call to Action: Don’t Let Flood Insurance Fall Through the Cracks
This September, Congress will likely do what it has done for years: extend the NFIP a few more months and congratulate itself for averting a shutdown. That status quo is no longer good enough. Climate-driven floods won’t wait, and military families on the move can’t wait either. Every hurricane season that arrives without a reformed, long-term NFIP in place is a gamble with homeowners’ livelihoods and taxpayers’ money. We can’t keep leaving communities one storm away from insurance calamity.
Instead, lawmakers should treat the upcoming deadline as a turning point. Use the short-term extension as a bridge, not an excuse, and finalize a multi-year reauthorization with bipartisan reforms as soon as possible.
Such a bill should incorporate the best ideas from the Senate working group and stakeholder input: fiscal improvements to the program, updated maps and incentives, and measures to keep premiums manageable. Passing it will require political courage, but the payoff is immense. It would bring peace of mind to millions of Americans in flood zones who will know their insurance is secure. It would affirm to our servicemembers that when they receive orders across the country, Congress has their back on something as fundamental as protecting their home. And it would demonstrate that Washington can still solve a pressing problem before it becomes a crisis.
The Front Lines
In my role at DCUC, I often remind policymakers that credit unions and military families are on the front lines of these issues. We stand ready to work with Congress on a sustainable, affordable future for the NFIP. But ultimately, we need our elected leaders to act. The Senate has lit a spark of progress – now it’s up to the full Congress to fuel that flame and deliver results.
A good first step is simply recognizing, as so many of us do, that flood insurance isn’t a partisan issue, it’s a people issue. Homeownership, financial security, and disaster recovery are on the line.
Congress should move with urgency and unity to strengthen and renew the National Flood Insurance Program. America’s military families, and all families who live with the threat of flooding, deserve nothing less than a permanent solution. Let’s stop kicking the can and start rolling out a plan – a plan that will keep our communities safe, our housing market confident, and our servicemembers focused on their duty, knowing their homes are protected come hell or high water.
Jason Stverak is chief advocacy officer with the Defense CU Council.
