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Title 42 — The Public Health and WelfareRelease 119-73

§4055 Reinsurance coverage

Title 42 › Chapter CHAPTER 50— - NATIONAL FLOOD INSURANCE › Subchapter SUBCHAPTER II— - ORGANIZATION AND ADMINISTRATION OF FLOOD INSURANCE PROGRAM › Part Part A— - Industry Program With Federal Financial Assistance › § 4055

Last updated Apr 6, 2026|Official source

Summary

The Administrator can buy reinsurance from the private market for the flood insurance pool created under section 4051. That reinsurance will cover losses bigger than what the pool keeps under an excess-loss agreement. The Administrator sets rates and terms and may require premiums or fees to pay expected losses and costs. The Administrator can make excess-loss agreements so the pool keeps enough risk after buying reinsurance to meet the program’s goals and keep insurers sharing risk as much as possible. All claims above the pool’s share must be filed by the pool as a portfolio under rules the Administrator sets.

Full Legal Text

Title 42, §4055

The Public Health and Welfare — Source: USLM XML via OLRC

(a)(1)The Administrator is authorized to take such action as may be necessary in order to make available, to the pool formed or otherwise created under section 4051 of this title, reinsurance for losses (due to claims for proved and approved losses covered by flood insurance) which are in excess of losses assumed by such pool in accordance with the excess loss agreement entered into under subsection (c).
(2)The Administrator is authorized to secure reinsurance of coverage provided by the flood insurance program from the private market at rates and on terms determined by the Administrator to be reasonable and appropriate, in an amount sufficient to maintain the ability of the program to pay claims.
(b)Such reinsurance shall be made available pursuant to contract, agreement, or any other arrangement, in consideration of such payment of a premium, fee, or other charge as the Administrator finds necessary to cover anticipated losses and other costs of providing such reinsurance.
(c)The Administrator is authorized to negotiate an excess loss agreement, from time to time, under which the amount of flood insurance retained by the pool, after ceding reinsurance, shall be adequate to further the purposes of this chapter, consistent with the objective of maintaining appropriate financial participation and risk sharing to the maximum extent practicable on the part of participating insurance companies and other insurers.
(d)All reinsurance claims for losses in excess of losses assumed by the pool shall be submitted on a portfolio basis by such pool in accordance with terms and conditions established by the Administrator.

Legislative History

Notes & Related Subsidiaries

Editorial Notes

References in Text

This chapter, referred to in subsec. (c), was in the original a reference to “this title” meaning title XIII of Pub. L. 90–448, Aug. 1, 1968, 82 Stat. 572, known as the National Flood Insurance Act of 1968, which is classified principally to this chapter. For complete classification of this Act to the Code, see

Short Title

note set out under section 4001 of this title and Tables.

Amendments

2012—Subsec. (a). Pub. L. 112–141, § 100232(d)(3), designated existing provisions as par. (1), inserted heading, substituted “The Administrator” for “The Director” and added par. (2). Subsecs. (b) to (d). Pub. L. 112–141, § 100238(b)(1), substituted “Administrator” for “Director”. 1983—Pub. L. 98–181 substituted “Director” for “Secretary” wherever appearing.

Statutory Notes and Related Subsidiaries

Effective Date

Section effective 120 days following Aug. 1, 1968, or such later date prescribed by the Secretary but in no event more than 180 days following Aug. 1, 1968, see section 1377 of Pub. L. 90–448, set out as a note under section 4001 of this title.

Transfer of Functions

For transfer of all functions, personnel, assets, components, authorities, grant programs, and liabilities of the Federal Emergency Management Agency, including the functions of the Under Secretary for Federal Emergency Management relating thereto, to the Federal Emergency Management Agency, see section 315(a)(1) of Title 6, Domestic Security. For

Transfer of Functions

, personnel, assets, and liabilities of the Federal Emergency Management Agency, including the functions of the Director of the Federal Emergency Management Agency relating thereto, to the Secretary of Homeland Security, and for treatment of related references, see former section 313(1) and section 551(d), 552(d), and 557 of Title 6, Domestic Security, and the Department of Homeland Security Reorganization Plan of November 25, 2002, as modified, set out as a note under section 542 of Title 6.

Reference

Citations & Metadata

Citation

42 U.S.C. § 4055

Title 42 — The Public Health and Welfare

Last Updated

Apr 6, 2026

Release point: 119-73