A partial U.S. government shutdown began at midnight on January 30, once again causing the National Flood Insurance Program (NFIP) to lapse. While lawmakers are expected to reach a short-term agreement more quickly than during past shutdowns, the pause in NFIP operations creates immediate challenges for insurance agents, brokers, and their policyholders.
As history has shown, even brief NFIP lapses can have outsized consequences — particularly for homebuyers, property owners, and businesses that need flood insurance to move forward with transactions or maintain adequate protection. Existing policies remain in force and claims can still be paid, but the program cannot issue new policies, renew expiring coverage, or process policy changes such as increases or endorsements.
For agents and brokers, this unpredictability makes one thing clear: relying solely on a federal program subject to political stalemates puts clients at risk.
“Private flood insurance offers meaningful advantages over the NFIP — broader coverage terms, greater flexibility, no waiting period, and no disruption tied to government shutdowns,” said Lauren Savage, President of TMH’s Private Flood Division. “Waiting until a lapse occurs can leave clients exposed and agents scrambling. Private flood coverage is not just an alternative, it’s a more resilient solution that aligns with today’s flood risk realities.”
Unlike the NFIP, private flood insurance is not impacted by government shutdowns. Beyond availability, private flood coverage offers meaningful advantages that many policyholders may not realize, including:
- No waiting period to bind coverage
- Higher building and contents limits than the NFIP
- No federal fees or co-insurance penalties
- Additional coverages not available through the NFIP, such as additional living expenses or loss of rents
- Special sub-limits for basements and enclosures
- More flexible deductible options
- Faster, more efficient claims handling
For agents, private flood allows you to help clients meet lender requirements quickly while often delivering broader, more comprehensive protection.
The NFIP will eventually be reauthorized, but the disruption is already here. With another lapse underway, now is the time for brokers and agents to proactively steer clients toward private flood insurance solutions that are available, flexible, and dependable.
When federal programs pause, protection shouldn’t.