Private insurers freed to undercut federal flood program
S. 2053 — A bill to ensure that Write Your Own companies can sell private flood insurance products that compete with National Flood Insurance Program products. · Filed by Rick Scott (R-FL) · Introduced Jun 12, 2025 · Referred to committee
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What it does
This bill prohibits the Federal Emergency Management Agency (FEMA) from requiring Write Your Own (WYO) insurance companies—private insurers that sell federal flood insurance under their own brand names—to agree not to sell competing private flood insurance products as a condition of participating in the federal program. Currently, FEMA can contractually bar WYO companies from offering private alternatives; this bill removes that restriction, allowing them to sell both federal and private flood insurance simultaneously.
Why we flagged it
The bill's operative mechanism is to remove a contractual restriction on private insurers, allowing them to compete directly with a federal insurance program. This is a deregulatory move that shifts market dynamics in favor of private flood insurance at the potential expense of the federal program's risk pool.
What the text implies
- WYO companies may use their federal program participation as a loss-leader or customer acquisition channel, then upsell customers to private products, potentially destabilizing the NFIP's risk pool by concentrating lower-margin federal business among the highest-risk properties.
- The bill does not address disclosure or conflict-of-interest rules, so customers may not clearly understand that the same agent selling them federal flood insurance is incentivized to steer them toward private alternatives.
The full analysis lists 4 implications of this text.
Who stands to gain
private property insurance companies (WYO participants); insurance agents and brokers (expanded commission opportunities); private flood insurance underwriters