Lloyd's underwriters writing property risks in the US said their business would be boosted with the cessation of the National Flood Insurance Program (NFIP).
Under the NFIP, the federal government makes insurance available for flood losses as flood damage is excluded under homeowner policies in the US. The NFIP offers maximum limits of $250,000 for dwelling coverage and $100,000 for personal contents. The NFIP is set to expire at the end of June and, as yet, the US Congress has not moved to reauthorise the scheme.
The lack of action by Congress has alarmed US insurers who argue that, if the reauthorisation of the NFIP is delayed, it will lead to administrative problems and disruption for policyholders.
Insurance groups, including the American Insurance Association, have recently written to Congress to express their concerns.
But, in contrast, some Lloyd's underwriters would welcome the end of the NFIP as it would lead to more flood cover being bought on the open market.
"We write a number of deals in excess of the NFIP which are quite common in the market and reasonably lucrative," one Lloyd's underwriter said.
