Entitlement reform has eluded Congress for years, even while delays may only increase the pain reform brings in the near-term. The main challenge facing Social Security, Medicare, and Medicaid reform debates is simple – nobody agrees on the path forward. The unfortunate, but typical, result is that much-needed change gets pushed to the margins, leaving substantive solutions for another day.

However, as we examine in this paper, the lesser-known National Flood Insurance Program (NFIP) actually presents an unique opportunity for an important entitlement reform success story.

Our findings include:

  • Already $23 billion in debt, the NFIP will face compounding problems as its unsustainable revenue structure meets rising risks of floods and more crowded coastlines into the future.
  • The NFIP is ripe for reform: the urgency of need is complemented by increasing comprehension of the problem – and solution – enhanced by new technology, well-developed reform ideas, and alignment among key public and private stakeholders that can get reform through political challenges.
  • NFIP reform should: (1) unmask the price signal by making premium subsidy transparent; (2) respect the science that can make solutions smarter; (3) put mitigation at the core of resilience; and (4) ensure a balance of stakeholder interests through a long-term transition with clear mileposts.
  • Mitigation should be at the core of reform. A case study in the UK showed that investments in resilience reduced flood losses by 91 percent, more than paying for itself in the long-run.


Resilient Reform For The NFIP: A Path Forward For A Sustainable Flood Insurance System