US Code

Public Law 119-83 (04/13/2026)

42 U.S.C. § 4081

Services by insurance industry

(a)

Contracting for services and facilities

section 4018 of this titleIn administering the flood insurance program under this subchapter, the Administrator is authorized to enter into any contracts, agreements, or other appropriate arrangements which may, from time to time, be necessary for the purpose of utilizing, on such terms and conditions as may be agreed upon, the facilities and services of any insurance companies or other insurers, insurance agents and brokers, or insurance adjustment organizations; and such contracts, agreements, or arrangements may include provision for payment of applicable operating costs and allowances for such facilities and services as set forth in the schedules prescribed under .

(b)

Certain laws inapplicable to contracting

section 6101 of title 41Any such contracts, agreements, or other arrangements may be entered into without regard to the provisions of or any other provision of law requiring competitive bidding and without regard to the provisions of chapter 10 of title 5.

(c)

Hold harmless

The Administrator of the Federal Emergency Management Agency shall hold any agent or broker selling or undertaking to sell flood insurance under this chapter harmless from any judgment for damages against such agent or broker as a result of any court action by a policyholder or applicant arising out of an error or omission on the part of the Federal Emergency Management Agency, and shall provide any such agent or broker with indemnification, including court costs and reasonable attorney fees, arising out of and caused by an error or omission on the part of the Federal Emergency Management Agency and its contractors. The Administrator of the Federal Emergency Management Agency may not hold harmless or indemnify an agent or broker for his or her error or omission.

(d)

FEMA authority on transfer of policies

Notwithstanding any other provision of this chapter, the Administrator may, at the discretion of the Administrator, refuse to accept the transfer of the administration of policies for coverage under the flood insurance program under this chapter that are written and administered by any insurance company or other insurer, or any insurance agent or broker.

(e)

Risk transfer

The Administrator may secure reinsurance of coverage provided by the flood insurance program from the private reinsurance and capital markets 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.

Pub. L. 90–448, title XIII, § 134582 Stat. 585 Pub. L. 97–35, title III, § 341(e)95 Stat. 419 Pub. L. 98–181, title I97 Stat. 1229 Pub. L. 103–325, title V, § 574108 Stat. 2278 Pub. L. 112–141, div. F, title II126 Stat. 958 Pub. L. 113–89, § 10128 Stat. 1025 Pub. L. 117–286, § 4(a)(263)136 Stat. 4334 (, , ; , , ; [title IV, § 451(d)(1)], , ; , , ; , §§ 100238(b)(1), 100245, , , 966; , , ; , , .)

Editorial Notes

References in Text

Pub. L. 90–44882 Stat. 572 section 4001 of this titleThis chapter, referred to in subsecs. (c) and (d), was in the original a reference to “this title” meaning title XIII of , , , 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 and Tables.

Codification

section 6101 of title 4141 U.S.C. 5Pub. L. 111–350, § 6(c)124 Stat. 3854 In subsec. (b), “” substituted for “section 3709 of the Revised Statutes ()” on authority of , , , which Act enacted Title 41, Public Contracts.

Amendments

Pub. L. 117–2862022—Subsec. (b). substituted “chapter 10 of title 5.” for “the Federal Advisory Committee Act (5 U.S.C. App.).”

Pub. L. 113–892014—Subsec. (e). added subsec. (e).

Pub. L. 112–141, § 100238(b)(1)2012—Subsecs. (a), (c). , substituted “Administrator” for “Director” wherever appearing.

Pub. L. 112–141, § 100245Subsec. (d). , added subsec. (d).

Pub. L. 103–3251994—Subsec. (b). inserted before period at end “and without regard to the provisions of the Federal Advisory Committee Act (5 U.S.C. App.)”.

Pub. L. 98–1811983—Subsec. (a). substituted “Director” for “Secretary”.

Pub. L. 97–351981—Subsec. (c). added subsec. (c).

Statutory Notes and Related Subsidiaries

Effective Date of 1981 Amendment

Pub. L. 97–35section 371 of Pub. L. 97–35section 3701 of Title 12Amendment by effective , see , set out as an Effective Date note under , Banks and Banking.

Effective Date

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

Transfer of Functions

section 315(a)(1) of Title 6For 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 , Domestic Security.

section 542 of Title 6For 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 sections 551(d), 552(d), and 557 of Title 6, Domestic Security, and the Department of Homeland Security Reorganization Plan of , as modified, set out as a note under .

Oversight and Expense Reimbursements of Insurance Companies

Pub. L. 112–141, div. F, title II, § 100224126 Stat. 936

“(a)

Submission of Biennial Reports.—

“(1)

To the administrator .—

Not later than 20 days after the date of enactment of this Act [], each property and casualty insurance company participating in the Write Your Own program shall submit to the Administrator any biennial report required by the Federal Emergency Management Agency to be prepared in the prior 5 years by such company.
“(2)

To gao .—

Not later than 10 days after the submission of the biennial reports under paragraph (1), the Administrator shall submit all such reports to the Comptroller General of the United States.
“(3)

Notice to congress of failure to comply .—

The Administrator shall notify and report to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives on any property and casualty insurance company participating in the Write Your Own program that failed to submit its biennial reports as required under paragraph (1).
“(4)

Failure to comply .—

A property and casualty insurance company participating in the Write Your Own program which fails to comply with the reporting requirement under this subsection or the requirement under section 62.23(j)(1) of title 44, Code of Federal Regulations (relating to biennial audit of the flood insurance financial statements) shall be subject to a civil penalty in an amount of not more than $1,000 per day for each day that the company remains in noncompliance with either such requirement.
“(b)

Methodology To Determine Reimbursed Expenses .—

Not later than 180 days after the date of enactment of this Act [], the Administrator shall develop a methodology for determining the appropriate amounts that property and casualty insurance companies participating in the Write Your Own program should be reimbursed for selling, writing, and servicing flood insurance policies and adjusting flood insurance claims on behalf of the National Flood Insurance Program. The methodology shall be developed using actual expense data for the flood insurance line and can be derived from—
“(1)
flood insurance expense data produced by the property and casualty insurance companies;
“(2)
flood insurance expense data collected by the National Association of Insurance Commissioners; or
“(3)
a combination of the methodologies described in paragraphs (1) and (2).
“(c)

Submission of Expense Reports .—

To develop the methodology established under subsection (b), the Administrator may require each property and casualty insurance company participating in the Write Your Own program to submit a report to the Administrator, in a format determined by the Administrator and within 60 days of the request, that details the expense levels of each such company for selling, writing, and servicing standard flood insurance policies and adjusting and servicing claims.
“(d)

FEMA Rulemaking on Reimbursement of Expenses Under the Write Your Own Program .—

Not later than 12 months after the date of enactment of this Act [], the Administrator shall issue a rule to formulate revised expense reimbursements to property and casualty insurance companies participating in the Write Your Own program for their expenses (including their operating and administrative expenses for adjustment of claims) in selling, writing, and servicing standard flood insurance policies, including how such companies shall be reimbursed in both catastrophic and noncatastrophic years. Such reimbursements shall be structured to ensure reimbursements track the actual expenses, including standard business costs and operating expenses, of such companies as closely as practicably possible.
“(e)

Report of the Administrator .—

Not later than 60 days after the effective date of the final rule issued pursuant to subsection (d), the Administrator shall submit to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives a report containing—
“(1)
the specific rationale and purposes of such rule;
“(2)
the reasons for the adoption of the policies contained in such rule; and
“(3)
the degree to which such rule accurately represents the true operating costs and expenses of property and casualty insurance companies participating in the Write Your Own program.
“(f)

GAO Study and Report on Expenses of Write Your Own Program.—

“(1)

Study .—

Not later than 180 days after the effective date of the final rule issued pursuant to subsection (d), the Comptroller General of the United States shall—
“(A)
conduct a study on the efficacy, adequacy, and sufficiency of the final rules issued pursuant to subsection (d); and
“(B)
report to the Committee on Banking, Housing, and Urban Affairs of the Senate and the Committee on Financial Services of the House of Representatives on the findings of the study conducted under subparagraph (A).
“(2)

GAO authority .—

In conducting the study and report required under paragraph (1), the Comptroller General—
“(A)
may use any previous findings, studies, or reports that the Comptroller General previously completed on the Write Your Own program;
“(B)
shall determine if—
“(i)
the final rule issued pursuant to subsection (d) allows the Federal Emergency Management Agency to access adequate information regarding the actual expenses of property and casualty insurance companies participating in the Write Your Own program; and
“(ii)
the actual reimbursements paid out under the final rule issued pursuant to subsection (d) accurately reflect the expenses reported by property and casualty insurance companies participating in the Write Your Own program, including the standard business costs and operating expenses of such companies; and
“(C)
shall analyze the effect of the final rule issued pursuant to subsection (d) on the level of participation of property and casualty insurers in the Write Your Own program.”
, , , provided that:

section 100224 of Pub. L. 112–141section 4004 of this title[For definitions of terms used in , set out above, see .]