WASHINIGTON (1/7/13)--The new chairman of the House Financial Service Committee, Rep. Jeb Hensarling (R-Texas), has committed his panel to taking up the issue of flood insurance with a look at ways to privatize the flood insurance market.
In remarks to his House colleagues Friday, Hensarling called the existing National Flood Insurance Program (NFIP) "broke" and a taxpayer burden.
In the middle of 2012, Congress approved a five-year extension of NFIP and that legislation contained some reforms to the program. The Credit Union National Association (CUNA) strongly supported the extension for the certainly it lends credit unions as mortgage lenders. Over time, the government program has been subject to almost a dozen short-term extensions--and even some lapses of authorization.
CUNA has said the erratic history has complicated the mortgage lending process and the longer-term extension helps ensure that credit unions--and the consumers they serve--can have a much greater degree of confidence in the lending process and the prospect of financing their homes.
Hensarling called the 2012 reforms "modest" and noted he has "long been critical" of government-provided flood insurance.
"As chairman of the Financial Services Committee, I wish to inform all members in this Congress, our committee will take up legislation to transition to a private, innovative, competitive, sustainable flood insurance market," he said Friday during debate on the $9.7 billion Hurricane Sandy aid package that was approved.