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Wednesday, June 30, 2010

National Flood Insurance Program Reauthorization News

As you probably know, the National Flood Insurance Program (NFIP) expired on midnight May 31, 2010 and has not been reauthorized by Congress. Consequently, the Program is experiencing a hiatus – a period without authority to:

Issue increased coverage on existing policies for which endorsement and premium payment dates are on or after June 1, 2010, or Issue renewal policies for which the renewal premium is received by the company on or after June 1, 2010, and after the end of the 30-day renewal grace period, until Congress reauthorizes the Program.

While awaiting Congressional reauthorization, FEMA is issuing the guidance below. For the most up-to-date information on the status of the NFIP please visit or call the FEMA News Desk at 202-646-3272.

New Policies

New policies for which the application was completed on or before May 31, 2010, and the application and premium payment were received within 10 days of the application date, will be issued for coverage and will become effective on the requested effective date, in accordance with the applicable waiting period rules.

For loans closing prior to the first day of hiatus, when the application is dated on or before closing and the premium payment is from the escrow account (lender’s check), title company, or settlement attorney, and is received within 30 days from the closing date, the policy can be issued effective the date of the closing.

For loans closing prior to the first day of hiatus, when the application is dated on or before closing and the premium payment is not part of the closing (i.e., the applicant or applicant’s representative check or credit card) and the application and premium were received within 10 days of the application date, the policy can be issued effective the date of the closing only if the presentment of premium was on or before the closing date. If the presentment of premium (check or credit card date) was on or after June 1, 2010, the policy cannot be issued, even though the application and closing occurred prior to the hiatus.

For loans closing on or after the first day of hiatus, when the application is dated prior to the hiatus and the presentment of premium is prior to the hiatus, the policy may be issued effective at closing so long as premium is received within 10 days of the closing date.

As always, the starting dates of NFIP coverage depend on the applicable flood insurance waiting period.

Policies that are in force before midnight of the last day of effective Program authorization will remain in force, and claims under those policies are to be processed and paid as usual afterwards (once hiatus begins).

Claims for covered losses occurring during a hiatus, on existing policies and on policies issued effective after the last day of effective authorization, are to be processed and paid as usual.

WYO Companies may investigate claims under a reservation-of-rights letter or a non-waiver agreement, up to the point of payment. Under either, WYO Companies would reserve the right not to pay the claim if Congress does not reauthorize the NFIP while continuing the investigation of the claim.

If reauthorization is granted retroactively, WYO Companies can issue policies effective as of the date they receive payments (subject to applicable waiting periods), and claims for covered losses can be processed.

Determining Payment Receipt Dates, New Policy Premiums, Renewal Policy Premiums, Added Coverage Endorsements

The controlling factor in determining payment receipt dates for new policy premiums, renewal policy premiums, or added coverage endorsements is when the insurance company receives payment, not the standard mail postmark.

However, proof of mailing receipts or third-party receipts that WYO Companies receive through certified mail or from entities such Federal Express (FedEx), United Parcel Service (UPS), and courier services do serve as payment receipt dates.

There will be no interruption in coverage if a customer mails the premium and the WYO Company receives it on or prior to midnight of the last day of effective Program authorization. See the exception listed below under Hiatus Scenarios, where the WYO Company is allowed to issue or renew policies even if the premium is received after a hiatus begins.

Hiatus Scenarios

Policies without a 30-Day Waiting Period

If the reauthorization is not retroactive to the first day of the hiatus, policies without a 30-day waiting period would become effective on the date the reauthorization is effective. This rule applies to loan closings occurring on or after the first day of the hiatus.

Policies with a 30-Day Waiting Period

If the reauthorization is not retroactive to the first day of the hiatus, policies with a 30-day waiting period would become effective 30 days after Congress has reauthorized the NFIP.


If the renewal offer was issued prior to authorization expiration, and the renewal premium is received before or within the 30-day grace period, the policy can be renewed even if the renewal premium was received after authorization expiration. The same rule applies on an underpayment notice issued before authorization expiration.
WYO Companies are no longer authorized to renew policies if the premium is received on or after the first day of the hiatus and after the end of the 30-day renewal grace period.


Existing policies can be canceled during the hiatus in accordance with valid NFIP cancellation reason codes.
Assignment of Flood Policies

An existing policy can be assigned provided the insured signs and dates the endorsement request.

For more details and FAQs concerning the NFIP reauthorization and how it affects the processing of flood insurance, go to

Please email us at with any questions about NFIP and FloodSmart.

If Today's Bid Fails, Next Likely Vote to Restart Flood Insurance: July 12

The future of the National Flood Insurance Program (NFIP) remains in limbo even as Hurricane Alex makes its way to the Texas coast today.

Washington lobbyists say a vote could come today but if that doesn't happen it could be until July 12 or thereafter before another vote is possible since Congress will not be around during the July 4th holiday.

The NFIP expired on June 1, the first official day of hurricane season. Since then, flooding has occurred in several states.

On June 23, the House of Representatives passed another temporary extension of the NFIP, good through Sept. 30, 2010, but the Senate has failed to take action so far.

Even if the Senate passed an NFIP extension, a flood insurance policy normally does not go into effect for 30 days after the policy is purchased, further underscoring the importance of renewing the program as quickly as possible, says the National Association of Insurance Commissioners (NAIC). The NAIC has sent a letter to House and Senate leaders urging immediate action to extend the National Flood Insurance Program (NFIP). In the letter, regulators stressed that timing is negatively affecting consumers.

"As state regulators, we are deeply concerned with the impact the nearly month-long lapse has caused for consumers and future flood victims across the country," said Jane L. Cline, NAIC president and West Virginia Insurance Commissioner. "It is imperative that Congress act to quickly to extend the program so that consumers can protect themselves."

Blain Rethmeier, senior vice president for public affairs for the American Insurance Association, says right now the future of the NFIP remains in limbo with no clear legislative path for a retroactive extension of the program.

"There is a slim chance the Senate will have an opportunity to pass the short term extension, but with Senator Byrd's funeral, it looks unlikely," Rethmeier said. "We very well could go into the July 4th recess without any resolution."

Sen. David Vitter of Louisiana brought the NFIP extension through Sept. 30 to the Senate floor for unanimous consent yesterday, according Matt Brady, director of media relations for the National Association of Mutual Insurance Cos. (NAMIC). But Sen. Dick Durbin of Illinois objected and offered the "extenders" bill, legislation that would extend the program through the end of the year but also includes other provisions that have drawn objections for increasing the budget deficit, according to Brady. Brady said Sen. Vitter then objected to the extenders bill.

"It's possible that it could be brought to the floor for unanimous consent again today," Brady said, but cautioned that if nothing happens today, the Senate would be less likely to take action tomorrow because of the memorial service planned for the late Sen. Robert Byrd. "They're also out all next week, so if they adjourn without extending the program nothing can happen until July 12 or 13 at a minimum."

The program has been unable to issue new or renewal policies since it was shut down May 31, although it is still paying claims. It is the fourth time in the past year that the program has been interrupted due to the failure of Congress to reauthorize it for an extended period.

Read more:

Tuesday, June 29, 2010

Topical Storm Alex

The latest reports still show TS Alex heading for landfall just south of
the Texas – Mexico boarder. Currently the storm is moving at 8 miles per
hour with sustained wind speed of 70 miles per hour. It is estimated that
the storm will peak at 97 mile per hour winds, just above the CAT 2
threshold of 95 miles per hour. Once the eye has developed we should
receive better reports on where the storm will make landfall. Alex is
expected to become a hurricane today with an estimated landfall of Thursday
still in the forecast.

Texas Prepares as Tropical Storm Alex Heads Toward Hurricane Status

As of 10 a.m. CDT on June 29, Tropical Storm Alex was nearing hurricane strength in the western Gulf of Mexico and the National Hurricane Center (NHC) expects it to reach hurricane status later in the day. The storm is forecast to make landfall near the Mexico/Texas border late on June 30.

Risk Management Solutions reports that Alex's potential track and intensity are similar to that of Hurricane Dolly, which made landfall near Brownsville, Texas, in July 2008 and caused more than $500 million in damage. Dolly caused most of its damage to South Padre Island before coming ashore causing additional wind and flood damage, according to the Insurance Council of Texas.

When and if Alex is declared by the NHC to have reached hurricane status, the Texas Windstorm Insurance Association - the insurer of last resort along the Texas coast - will cease accepting applications for coverage as of 12:01 a.m. on the day hurricane status is declared.

In Texas, hurricane warnings extend along the coast from south of Baffin Bay to the Rio Grande. A tropical storm warning is in effect from Baffin Bay to Port O'Connor.

In advance of the storm, Gov. Rick Perry issued a disaster proclamation for 19 Texas counties and ordered the pre-deployment of state resources, such as the National Guard and other emergency response professionals and equipment.

The governor's proclamation listed Aransas, Bee, Brooks, Cameron, Duval, Hidalgo, Jim Hogg, Jim Wells, Kenedy, Kleberg, Live Oak, McMullen, Nueces, Refugio, San Patricio, Starr, Webb, Willacy, and Zapata as being potentially vulnerable to impact from Alex. Perry also called upon the following counties to assist in the state's response to the storm: Atascosa, Bexar, Comal, Guadalupe, Medina and Wilson.

Brownsville, Texas, and Matamoros in Mexico are the largest cities located close to the projected landfall area. Brownsville has a population of around 140,000 and Matamoros, around 420,000, according to RMS. The popular resort area of South Padre Island in Texas is likely to be impacted, as well.

"Alex could become one of the earliest hurricanes in the season to hit Texas," according to Mark Hanna, a spokesman for the Insurance Council of Texas. "Ever since they began naming hurricanes in 1954, only two hurricanes have struck Texas before July 1."

Hurricane Audrey struck the Sabine Pass with 100 mile per hour winds on June 27, 1957, and Hurricane Bonnie struck Sea Rim State Park with 87 mile per hour wind gusts back on June 26, 1986

Here’s what you can do to stay safe during a flood:

Protect Yourself and Your Home

If flooding occurs, go to higher ground and avoid areas subject to flooding.

Do not attempt to walk across flowing streams or drive through flooded roadways.
If water rises in your home before you evacuate, go to the top floor, attic, or roof.

Listen to a battery-operated radio for the latest storm information.

Turn off all utilities at the main power switch and close the main gas valve if advised to do so.

If you’ve come in contact with floodwaters, wash your hands with soap and disinfected water.

What can I do to protect my home and family from a hurricane?

What can I do to protect my home and family from a hurricane?
Besides insuring your property, there are things you can do to minimize potential loss to your home and ensure your family's safety.

Develop a Family Plan

Create a Disaster Supply Kit

Have a Place to Go

Secure Your Home

Make a Pet Plan

Prepare for the Possibility of a Flood

Make sure any photos or videos of all of your important possessions are in a safe place. These documents will help you file an accurate and comprehensive flood insurance claim.

Store important documents and irreplaceable personal objects (such as photographs) where they won't get damaged. If major flooding is expected in your area, consider putting them in a storage facility.

Remember to talk to your insurance agent if you have questions or would like additional information.

Wednesday, June 23, 2010

House Passes Flood Insurance Extension; Senate Must Still Vote

The House of Representatives has passed another temporary extension of the National Flood Insurance Program until Sept. 30, 2010.

The program has been suspended from issuing new policies since May 31. Reauthorization provisions have been embedded in controversial legislation on jobless benefits and tax breaks that has been twice voted down in the Senate.

Tuesday, June 15, 2010

How Thieves Are Planning On Hacking Into Your Car

Securing your vehicle used to consist of making sure all the doors were locked, keeping valuable items hidden out of sight and parking it in a safe, preferably off-street location.

But a new generation of cars includes more tech wizardry than a jumbo jet, raising consumer concerns that vehicles are more vulnerable than ever to light-fingered criminals. In these times, however, those light fingers are more likely to be twiddling on a laptop or remote-entry system than sticking a wire clothes hanger through a cracked window.

A new study proves that the movement away from pure mechanization to digitization is exposing us to new opportunities for vulnerability. It's becoming increasingly easier to access all vehicles controls from one central location. The car's ECU, or electronic control unit, is the brain of your grocery getter. A team of researchers from The University of Washington in Seattle and The University of California San Diego recently took on the task of seeing if they could control a car's systems through its ECU.

The two lead researchers for the project tested two identical 2009 model year vehicles (they did not reveal the name of the car), plugging their laptops into the controls for the ECU and running a software system. Their findings show that there are two main hacking threats to you car:

- Physical Access: "Someone -- such as a mechanic, a valet, a person who rents a car, an ex-friend, a disgruntled family member, or the car owner -- can, with even momentary access to the vehicle, insert a malicious component into a car’s internal network via the ubiquitous OBD-II port (typically under the dash). The attacker may leave the malicious component permanently attached to the car’s internal network or, as we show in this paper, they may use a brief period of connectivity to embed the malware within the car’s existing components and then disconnect."

- Wireless interfaces: "In our car we identified no fewer than five kinds of digital radio interfaces accepting outside input, some over only a short range and others over indefinite distance. While outside the scope of this paper, we wish to be clear that vulnerabilities in such services are not purely theoretical. We have developed the ability to remotely compromise key ECUs in our car via externally-facing vulnerabilities, amplify the impact of these remote compromises using the results in this paper, and ultimately monitor and control our car remotely over the Internet."

After running tests using software with their laptops plugged in, the researchers were able to disable braking systems, control main vehicle functions and even turn off the engine, all while the test vehicle was traveling at speed.

Security In Today's Cars

Cars' vital functions, including steering, brakes and startup largely run on a system of interconnected electronic control units that form the car's central nervous system. These units run on millions of lines of computer code. It's estimated that the average premium new car runs on about 100 million lines of computer code, while Boeing's new 787 Dreamliner requires just 6.5 million code to function.

Representatives from the Big Three told us, not surprisingly, that they are working hard to make sure security and privacy are paramount. All the while, consumer demand is creating something of a supercomputer in every vehicle.

Ford, GM and Chrysler all have introduced wireless internet systems that allow consumers to surf the internet while in or around the vehicle and download music and road-trip directions to an in-car computer. Most in-car wireless systems work in much the same way as a home-internet wireless connection and require a password to gain entry to the network, said Chrysler's Nick Cappa. This basic step, he says, prevents almost all security breaches of the car's wireless system.

Cappa says that the system offered by Mopar as an option on certain Chrysler, Dodge and Jeep models is independent of, and not integrated with, a car's central electronics systems, including its hard drive and the media library.

"Think of its as a picnic table you can use in the vehicle but you can also detach and use outside the vehicle," he said.

Similarly, when a new user wishes to log-in to Ford's wireless internet system the driver must give their permission for a connection to be established, which prevents "piggybacking," according to company spokespeople. A music-encryption system also prevents anybody from removing or copying tunes from the car's on-board library by wireless connection or by plugging the hardware into another car. Its route finder information can be locked from prying eyes by a four-digit PIN code (similar to an ATM card's) when needed. Ford also says the SecuriLock engine-start system only works with a designated key that sends a unique signal code to a transponder in the engine amid some 72-million-billion code configurations (which would severely challenge the most dexterous of hackers).

While your ride seems to be safe at the moment, the threat looms ahead. All the while, it never hurts to park your car off-street and tuck away your valuables, either.