While the results achieved under these goals—increasing the number of insurance policies in force and reducing flood-related losses—provide valuable insights into how well the NFIP’s mission is being accomplished, they do not gauge participation in the program by the most vulnerable residents—those living in SFHAs. These goals include reducing flood losses, increasing the number of flood insurance policies sold, and improving the program’s financial status. This information would allow FEMA to assess whether the program is penetrating those areas most at risk of flooding, determine whether the financial risks to the government in these areas are increasing or decreasing, and better target marketing efforts to increase participation. This study was initiated to provide information about flood hazards, prevention, and mitigation. FIA officials agree that program participation rates are a useful measure that can provide insights for measuring the program’s success, including the effectiveness of marketing. While FIA maintains data on the number of flood insurance policies, the information it has on the total number of structures within SFHAs is poor, according to FIA’s Acting Administrator. Consequently, older data on the number of structures in these communities are used. Technologies Can Improve the Accuracy of Data Used to Determine Participation Rates

several current mapping technologies can be used to facilitate the collection of data on the number of structures in SFHAs. The Costs of Technology Are Not Fully Known, but Will Be Shared

The costs of using technology to accurately identify the number of structures in SFHAs are not fully known. The partnerships that FEMA has developed with state, local, and other federal agencies should reduce some of its costs to modernize its flood maps. Flood Insurance: Information on Financial Aspects of the National Flood Insurance Program (GAO/T-RCED-99-280, Aug. 25, 1999).
Why GAO Did This Study

This testimony discusses the preliminary results of GAO's ongoing review of the National Flood Insurance Program (NFIP), which is run by the Federal Emergency Management Administration's (FEMA) Federal Insurance Administration (FIA) and Mitigation Directorate, a major component of the federal government's efforts to provide flood assistance. This program creates standards to minimize flood losses.

What GAO Found

GAO found that FEMA has several performance goals to improve program results, including increasing the number of insurance policies in force. Although these goals provide valuable insight into the degree to which the program has reduced flood losses, they do not assess the degree to which the most vulnerable residents--those living in flood-prone areas--participate in the program. Capturing data on the number of uninsured and insured structures in flood-prone areas can provide FEMA with another indication of how well the program is penetrating those areas with the highest flood risks, whether the financial consequences of floods in these areas are increasing or decreasing, and where marketing efforts can better be targeted. However, before participation rates can be used to measure the program's success, better data are needed on the total number of structures in flood-prone areas. FIA tracks the number of insurance policies in these areas, but data on the overall number of structures are incomplete and inaccurate. Some communities are developing better data on the number of structures in flood-prone areas. FEMA is also trying to improve the quality of its data on the number of structures in flood-prone areas and is working to develop new mapping technologies that could facilitate the collection of such data. The cost of this new technology is not fully known, but the expense will be shared among federal, state, and local agencies.