Thinking of the following challenges,
1) Based on disaster stats, PA accounts for almost half of the after-disaster investment with Federal monies the primary funding source.
2) Although issues with the NFIP are complicated, a basic and major challenge is the NFIP struggles to secure adequate funding to meet the actual risks.
3) Some states can no longer secure HMGP funds because they have successfully applied mitigation, and therefore, in most disasters, do not meet the threshold for a Federal declaration.
Our office developed the following idea:
What if we diversified the risk to the NFIP and expanded its portfolio to include an insurance program for local gov for all or select hazards? This new offering would cover the same type of damages to infrastructure and facilities covered by PA and would be paid for by insurance policies sold to local gov.
We realize some local governments who regularly receive public assistance after a disaster would most likely not be interested in paying for something they already receive for free. So perhaps this new insurance could be used towards the 25% match. Or this insurance program could be designed for use by local governments after a disaster when a state cannot meet the threshold for a Federal declaration.
Also, by offering insurance to local governments for after-disaster costs, there could be an opportunity to encourage/support mitigation/preparedness/response. Similar to CRS, this could be through better rates for communities which implement improvements to lower their risk.