US officials believe the insurance industry needs to re-enter the Federal Government’s troubled National Flood Insurance Program (NFIP) to ensure its continuance.

The US Senate Committee for Bank, Housing and Urban Affairs says flood mapping and the future input of insurers are essential for the NFIP to continue past September 30.

Committee Chairman Tim Johnson says the program needs to provide more certainty and “hopes to provide this through a long-term extension”.

Senator Richard Shelby says the NFIP posed a high risk to the US Government because of its growing debt of $US18 billion ($17.1 billion) and its structure.

He says the program needs significant revision before it could be reauthorised by September, including updated flood maps to evaluate the risk, ensuring that participants are paying a fair price for their insurance.

“Many of the existing maps are several decades old and don’t accurately reflect the cost and risk of living in a flood plain,” Senator Shelby told the hearing.

Federal Emergency Management Authority (FEMA) Administrator Craig Fugate says large-scale events such as hurricanes have stretched the current system.

“This risk would be better shared with the private sector rather than looking strictly at a taxpayer-funded system,” he said.

“I believe as we look at reauthorisation we need to look at how we encourage the private sector.”

Government Accountability Office MD Orice Brown says the program was originally established as a co-operative venture between the private sector and the Federal Government, but the insurers withdrew due to a lack of flood risk planning, mapping and inadequate building codes.

“Given these issues have largely been addressed, the private sector’s involvement warrants consideration,” Senator Brown said. “We need to find ways of reaching out to involve the private sector in this program.”