National Flood Insurance Program (NFIP) Rationale 2
National Flood Insurance Program (NFIP) Rationale 2 :
"The flood insurance program was initiated because it had become clear by the 1950s that private insurance companies could not profitably provide affordable flood coverage because of the catastrophic nature of flooding and the impossibility of developing an actuarial rate structure that could adequately reflect the risk to flood-prone properties, among other reasons. One of the primary purposes of the National Flood Insurance Act of 1968, which created NFIP, was to reduce federal expenditures for disaster assistance and flood control". (GAO, Natural Disasters: Public Policy Options, Nov 2007, 17)
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