For the fourth time since last December, Congress and the Senate have agreed (imagine that) to temporarily extend the National Flood Insurance Program (NFIP), just as Hurricane/Tropical Storm Alex struck the Texas Gulf Coast. The measure to reauthorize the federal flood insurance program is only good through September 30, 2010, at which point Congress and the Senate may very well allow it to again expire. The President is expected to sign the current legislation.
During these lapses, new flood insurance policies could not be issued. Now that the program is temorarily reinstated, new and renewed policies are effective retroactively. There is a 30-day waiting period after issuance of a new policy before it takes effect, unless it is issued in conjunction with a purchase. The rationale behind this is that homeowners may purchase flood insurance in the case of an immediate threat, only to cancel after that threat passes.