II 
Calendar No. 407 
112TH CONGRESS 
2D SESSION 
H. R. 5740 
IN THE SENATE OF THE UNITED STATES 
MAY 21, 2012 
Received; read twice and placed on the calendar 
AN ACT 
To extend the National Flood Insurance Program, and for 
other purposes. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘National Flood Insur-
ance Program Extension Act’’. 
SEC. 2. EXTENSION OF PROGRAM. 
(a) IN GENERAL.—Section 1319 of the National 
Flood Insurance Act of 1968 (42 U.S.C. 4026) is amended 
by striking ‘‘the earlier of the date of the enactment into 
law of an Act that specifically amends the date specified 
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means a contract for flood insurance coverage al-
lowed for sale under the laws of any State.’’. 
SEC. 4. PRIVATIZATION INITIATIVES. 
(a) FEMA AND GAO REPORTS.—Not later than the 
expiration of the 18-month period beginning on the date 
of the enactment of this Act, the Administrator of the 
Federal Emergency Management Agency and the Comp-
troller General of the United States shall each conduct a 
separate study to assess a broad range of options, meth-
ods, and strategies for privatizing the national flood insur-
ance program and shall each submit a report to the Com-
mittee on Financial Services of the House of Representa-
tives and the Committee on Banking, Housing, and Urban 
Affairs of the Senate with recommendations for the best 
manner to accomplish such privatization. 
(b) PRIVATE RISK-MANAGEMENT INITIATIVES.— 
(1) AUTHORITY.—The Administrator of the 
Federal Emergency Management Agency may carry 
out such private risk-management initiatives under 
the national flood insurance program as the Admin-
istrator considers appropriate to determine the ca-
pacity of private insurers, reinsurers, and financial 
markets to assist communities, on a voluntary basis 
only, in managing the full range of financial risks 
associated with flooding. 
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(2) ASSESSMENT.—Not later than the expira-
tion of the 12-month period beginning on the date 
of the enactment of this Act, the Administrator shall 
assess the capacity of the private reinsurance, cap-
ital, and financial markets by seeking proposals to 
assume a portion of the program’s insurance risk 
and submit to the Congress a report describing the 
response to such request for proposals and the re-
sults of such assessment. 
(3) PROTOCOL FOR RELEASE OF DATA.—The 
Administrator shall develop a protocol to provide for 
the release of data sufficient to conduct the assess-
ment required under paragraph (2). 
(c) REINSURANCE.—The National Flood Insurance 
Act of 1968 is amended— 
(1) 
in 
section 
1331(a)(2) 
(42 
U.S.C. 
4051(a)(2)), by inserting ‘‘, including as reinsurance 
of insurance coverage provided by the flood insur-
ance program’’ before ‘‘, on such terms’’; 
(2) 
in 
section 
1332(c)(2) 
(42 
U.S.C. 
4052(c)(2)), by inserting ‘‘or reinsurance’’ after 
‘‘flood insurance coverage’’; 
(3) in section 1335(a) (42 U.S.C. 4055(a))— 
(A) by inserting ‘‘(1)’’ after ‘‘(a)’’; and 
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(B) by adding at the end the following new 
paragraph: 
‘‘(2) The Director is authorized to secure reinsurance 
coverage of coverage provided by the flood insurance pro-
gram from private market insurance, reinsurance, and 
capital market sources at rates and on terms determined 
by the Director to be reasonable and appropriate in an 
amount sufficient to maintain the ability of the program 
to pay claims and that minimizes the likelihood that the 
program will utilize the borrowing authority provided 
under section 1309.’’; 
(4) in section 1346(a) (12 U.S.C. 4082(a))— 
(A) in the matter preceding paragraph (1), 
by inserting ‘‘, or for purposes of securing rein-
surance of insurance coverage provided by the 
program,’’ before ‘‘of any or all of’’; 
(B) in paragraph (1)— 
(i) by striking ‘‘estimating’’ and in-
serting ‘‘Estimating’’; and 
(ii) by striking the semicolon at the 
end and inserting a period; 
(C) in paragraph (2)— 
(i) by striking ‘‘receiving’’ and insert-
ing ‘‘Receiving’’; and 
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(ii) by striking the semicolon at the 
end and inserting a period; 
(D) in paragraph (3)— 
(i) by striking ‘‘making’’ and inserting 
‘‘Making’’; and 
(ii) by striking ‘‘; and’’ and inserting 
a period; 
(E) in paragraph (4)— 
(i) by striking ‘‘otherwise’’ and insert-
ing ‘‘Otherwise’’; and 
(ii) by redesignating such paragraph 
as paragraph (5); and 
(F) by inserting after paragraph (3) the 
following new paragraph: 
‘‘(4) Placing reinsurance coverage on insurance 
provided by such program.’’; and 
(5) 
in 
section 
1370(a)(3) 
(42 
U.S.C. 
4121(a)(3)), by inserting before the semicolon at the 
end the following: ‘‘, is subject to the reporting re-
quirements of the Securities Exchange Act of 1934, 
pursuant to section 13(a) or 15(d) of such Act (15 
U.S.C. 78m(a), 78o(d)), or is authorized by the Di-
rector to assume reinsurance on risks insured by the 
flood insurance program’’. 
(d) ASSESSMENT OF CLAIMS-PAYING ABILITY.— 
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(1) ASSESSMENT.—Not later than September 
30 of each year, the Administrator of the Federal 
Emergency Management Agency shall conduct an 
assessment of the claims-paying ability of the na-
tional flood insurance program, including the pro-
gram’s utilization of private sector reinsurance and 
reinsurance equivalents, with and without reliance 
on borrowing authority under section 1309 of the 
National Flood Insurance Act of 1968 (42 U.S.C. 
4016). In conducting the assessment, the Adminis-
trator shall take into consideration regional con-
centrations of coverage written by the program, peak 
flood zones, and relevant mitigation measures. 
(2) REPORT.—The Administrator shall submit 
a report to the Congress of the results of each such 
assessment, and make such report available to the 
public, not later than 30 days after completion of 
the assessment. 
SEC. 
5. 
STUDIES 
OF 
VOLUNTARY 
COMMUNITY-BASED 
FLOOD INSURANCE OPTIONS. 
(a) STUDIES.—The Administrator of the Federal 
Emergency Management Agency and the Comptroller 
General of the United States shall each conduct a separate 
study to assess options, methods, and strategies for offer-
ing voluntary community-based flood insurance policy op-
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