By a vote of 406 to 22, the U.S. House of Representatives on Tuesday overwhelmingly approved the Flood Insurance Reform Act of 2011 (House Resolution 1309).

All of the Florida House members voted for the bill. This legislation, if approved by the Senate and signed by President Barack Obama, would extend FEMA's National Flood Insurance Program (NFIP) for another 5 years.

This is important for Floridians because the NFIP is currently authorized only through Sept. 30, 2012.

Congress originally created the NFIP in 1968, but the program has had several lapses in authority.

During the most recent lapse in 2010, the NFIP was unable to issue new or renewal policies, although it continued to pay claims. That is not exactly the kind of stability the 5.7 million U.S. policy holders like to see.

The lapses also result in delayed real estate closings and considerable angst for those involved.

In 2010 alone, flood insurance could not be purchased or renewed for a total of 53 days.

The five-year extension in H.R. 1309 also comes with some reforms that are supposed to improve the integrity and stability of the program as well as increase the role of private markets in the management of flood insurance risk.

The NFIP is expected to set premiums that are actuarially sound. That sounds easy to do but in reality is not -- in my opinion -- due to the rarity of the most extreme flooding events. The NFIP is currently $18 billion in debt thanks to Hurricane Katrina in 2005. That number will likely increase as a result of this year's extreme flooding.

According to the Insurance Information Institute website, the Property Casualty Insurers Association of America (PCI) has conducted a study of current NFIP rates as a benchmarking tool to help lawmakers as they discuss the Flood Insurance Reform Act of 2011. The study shows that the true cost of NFIP flood coverage is much higher than is indicated in NFIP rates.

Currently, PCI says, the federal government is providing flood insurance on average at roughly one half of the true cost of coverage. In high-risk areas, the true cost is more than three times as much as NFIP rates would suggest. Even in moderate risk areas, where there is no explicit subsidy, the private rate would be about 23 percent above the NFIP rate on average, due to the cost of capital, reinsurance and taxes, among other things.

H.R. 1309 would raise the annual limit on flood insurance premium increases from 10 percent to 20 percent.

Proposed amendments to H.R. 1309 that would have terminated NFIP, and the current spending on television and radio commercials being aired to promote the flood insurance program, were voted down.