The National Association of Mutual Insurance Companies (NAMIC) has expressed support for a legislative package that would elevate the Federal Emergency Management Agency (FEMA) to a cabinet-level agency, placing it under direct oversight of the president.
The Fixing Emergency Management for Americans Act was approved by the US House of Representatives Committee on Transportation and Infrastructure on Sept. 3. According to NAMIC, the proposed move would enhance accountability and coordination at FEMA.
A statement from the House Committee on Transportation and Infrastructure indicated that the bill would allow FEMA to use project-based grants, enabling states to prioritize projects with the highest needs and accelerate the rebuilding process.
The legislation was introduced by committee chairman Rep. Sam Graves (pictured above), a Missouri Republican, and Rep. Rick Larsen, a Washington Democrat and ranking member of the committee.
“The FEMA Act is designed to address one simple fact that we all recognize, especially Americans who have been impacted by disasters: FEMA is not working the way it should for our communities," Graves said.
The bill also includes provisions to incentivize states to invest in mitigation efforts, establish “rainy day” funds, and encourage the purchase of private insurance policies.
Additional measures in the legislation would change federal permitting and procurement processes and establish a Recovery Task Force to address more than 1,000 unresolved disaster declarations dating back to Hurricane Katrina.
The bill aims to streamline the aid-application process, modify notifications to disaster victims, and promote increased nonfederal aid for disaster survivors.
“Insurance is built on the promise of being there for policyholders when they need it most, and sound emergency management is absolutely essential for insurers to help the victims of natural disasters begin the recovery process as quickly as possible,” said Jimi Grande, senior vice president of federal and political affairs for NAMIC.
Grande also noted that the bill would help FEMA better prepare for, respond to, and mitigate the effects of increasingly severe weather events.
President Donald Trump has previously suggested that FEMA’s role in disaster response could be reduced or phased out after the current hurricane season, with states taking on more responsibility for managing emergencies.
In response, some emergency management experts have warned that eliminating FEMA could leave states unprepared for large-scale disasters, particularly in administering the National Flood Insurance Program.
Insurance brokers have noted that if FEMA’s role is reduced, individuals and businesses may need to take greater responsibility for securing adequate insurance and implementing risk mitigation strategies. While FEMA assistance is often limited, brokers emphasize that full insurance coverage and proactive planning are necessary to address the financial impact of disasters.
NAMIC cited research showing that every $1 spent on mitigation can save as much as $13 in future losses. As Congress considers changes to FEMA’s structure and operations, the debate continues over the best approach to federal disaster management and the roles of both public agencies and the private insurance sector.
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