WASHINGTON (July 15, 2010) Bipartisan legislation that provides significant reform to the National Flood Insurance Program could instead ultimately harm consumers because of a last minute amendment on the House floor, the National Association of Mutual Insurance Companies (NAMIC) said today.
“It’s extremely disappointing to see, once again, meaningful, needed reform legislation undermined,” said Jimi Grande, senior vice president of federal and political affairs for NAMIC. “The original bill contained reforms with broad, bipartisan support that would have started the NFIP on the road back to financial stability.”
An amendment offered by Rep. Gene Taylor, D-Miss., on the House floor weakens the benefits that the bill would have enacted by adding bureaucratic hurdles to writing coverage and the claims process.
The legislation, H.R. 5114, was sponsored by Rep. Maxine Waters, D-Calif. As introduced, it would have phased in actuarially sound rates and increasing coverage limits. Rep. Waters’ bill also gradually introduced the use of updated flood maps to help homeowners who find themselves in a flood zone adjust their budgets to include flood insurance premiums.
“Rather than attracting new companies to the NFIP, this amendment will make it more difficult for insurers to write flood coverage and discourage them from participating in the program,” Grande said.
H.R. 5114 was passed by a vote of 329 to 90. The bill now heads to the Senate.
“We at NAMIC were eager to see common sense reforms enacted for the NFIP, but unfortunately this bill now discourages participation in the NFIP,” Grande said. “This amendment will only add to the problems facing the program, and make coverage more expensive and difficult to find for consumers.”
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