There’s at least a little bit of good news for the homeowners and residents facing flooding along the Mississippi River. According to Insurance Journal, a House committee approved legislation that would extend the federal flood insurance program for five years. It also includes a plan for financial reform. This legislation would mean the National Flood Insurance Program will be around until 2016 and includes a plan to increase premiums, improve flood maps and receive more public input.

The program is set to expire this fall and has been extended on a short term basis several times. It is currently in more than $17 billion in debt. “Flood waters across the South and Midwest are on the rise, and so is the debt owed by this program,” Rep. Judy Biggert, R-Ill, told Insurance Journal.  “We need to put the National Flood Insurance Program back on stable financial footing so that it can provide homeowners with reliable coverage without putting taxpayers on the line for billions in losses.  This legislation will give the program long-term stability, help draw better flood maps, and initiate actuarially sound pricing.”

While two new option coverage options were rejected, many people supported the move to extend the program. “A five year extension is of the utmost importance, as are reforms to put the program on sound financial footing,” Charles Symington, Big “I” senior vice president of government affairs, told Insurance Journal. “We are especially grateful that the Committee rejected an amendment that would have removed the inclusion of optional business interruption and additional living expenses coverage as these provisions will better safeguard consumers against flood loss.”

Now the program will move to the full House and Senate for a vote. Sponsors are hopeful that it will be passed before the end of September when the current program expires. “Given the current flooding taking place on the Mississippi river, it is especially critical to get a long-term extension of the program in place so that this debate can move beyond Congress and residents in flood-prone areas can have the stability in the program they so desperately need to insure their homes and businesses,” Leigh Ann Pusey, president and CEO of the American Insurance Association, told Insurance Journal.

The Federal Emergency Management Agency issued a warning to residents of Louisiana to prepare for flooding and keep flood insurance documents safe. FEMA is encouraging residents to follow the direction released by local officials in terms of evacuations.
“Last Friday, May 6, 2011, President Obama issued an emergency declaration specific to 22 parishes throughout Louisiana,” said Federal Coordinating Officer Gerry Stolar in a news release. “That equates to one-third of the communities throughout this state currently at risk for potential flooding. FEMA is asking Louisiana residents living in the declared parishes to take measures now to best protect their lives and properties, including knowing the facts about flooding and safeguarding important documents, such as insurance policies.”