FEMA Secures NFIP Flood Reinsurance for 2021
The Federal Emergency Management Agency (FEMA) has secured $1.153 billion of flood reinsurance for the National Flood Insurance Program (NFIP) for 2021, at a premium of $195.8 million. It was announced in September 2020 that FEMA had returned to the traditional reinsurance market and commenced the procurement of reinsurance for the NFIP for 2021.
After securing $1.33 billion of traditional reinsurance from a panel of 27 reinsurers at the start of 2020, it was suggested that FEMA could increase the size of the program for 2021, dependent on both appetite and price. However, FEMA revealed that for 2021 the amount of risk transferred to the traditional reinsurance market stands at $1.153 billion, which represents a decline of more than 13 percent from the previous year.
FEMA has been leveraging reinsurance for the NFIP for a number of years, after testing the market with a limited placement in 2016, before securing its first full placement ahead of the Jan 1st, 2017 renewals.