The federal government shutdown has led to the immediate expiration and lapse of the National Flood Insurance Program (NFIP), freezing all new and renewing flood insurance policies across the nation since October 1, 2025. In response, the SmarterSafer Coalition has issued an urgent call for Congress to take swift action and restore the vital program.
The lapse of the NFIP—the primary source of flood insurance for millions of Americans—poses significant risks, particularly during the peak of the Atlantic hurricane season. The coalition estimates that 4.7 million policyholders now face a potential lapse in coverage, leaving them vulnerable to disaster.
Real Estate Market Impacted
The freeze on policies is also severely impacting the real estate market. According to the National Association of Realtors (NAR), the lapse could affect approximately 1,300 property sales per day and roughly 40,000 closings per month, as flood insurance is often a mandatory requirement for mortgage transactions in high-risk areas.
“Communities can’t afford for Washington to play politics with disaster protection,” stated Chris Brown, Executive Director of the SmarterSafer Coalition. “Congress must move past short-term fixes and deliver a stable, forward-looking flood insurance program that strengthens resilience and saves taxpayer dollars.”
Call for Long-Term Reform
SmarterSafer is urging the Senate Banking Committee to hold an immediate hearing to examine the impacts and act swiftly to reauthorize the program. The coalition argues that Congress must use this crisis as a catalyst for meaningful, long-term reform.
The NFIP has faced over 30 short-term reauthorizations since 2017, a cycle the coalition argues undermines stability and solvency. With intensifying storms and rising costs, SmarterSafer advocates for a bipartisan solution that prioritizes:
- Affordability for policyholders.
- Pre-disaster mitigation to reduce future losses.
- Risk-transfer strategies that expand the role of private insurers.
The coalition stresses that a stable, reformed NFIP is essential to protecting communities and reducing the growing fiscal burden on taxpayers.
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