NFIP is over $24 billion in debt, and most experts agree that this deficit has grown largely for two reasons. First, FEMA has been slow to update its maps – in the aftermath of Katrina, it had turned out its maps had not been updated in over 20 years. The Natural Resources Defense Council (NRDC) also claimed that out-of-date maps contributed to both the shock and damage across New York and New Jersey after Sandy pummeled the region.
Furthermore, NFIP has been a political football, as politicians from coastal states have been loath to permit premiums increases under their watch. Proposals to account for risks due to not only historic flood threats, but to also for climate change and sea level rise risks, have long been a non-starter on Capitol Hill.
Congress passed a law in 2012 that required FEMA and NFIP to charge market rates, and climate change became a factor in how these policies were priced. But homeowners pushed back hard, and Congress moved quickly to undo that law. Another rate increase was enacted in 2015 as Congress scrambled to find a way to hack away at NFIP’s deficit, but homeowners lashed out again, and the cycle has continued.
via Triple Pundit Hurricane Harvey Tests Limits of Federal Flood Insurance Program