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NAMIC Lauds Senate Proposal for Flood Reform

WASHINGTON (Oct. 17, 2007) – The National Association of Mutual Insurance Companies (NAMIC) urged Congress to pass Senate-sponsored legislation that would reform the National Flood Insurance Program. The draft legislation was approved today by the Senate Committee on Banking, Housing and Urban Affairs.

“NAMIC appreciates the committee’s efforts to implement much-needed reforms to the National Flood Insurance Program,” said Justin Roth, NAMIC’s senior federal affairs director. “This legislation will go a long way toward putting the program back on solid financial footing.”

The legislation marked up by the committee includes several reforms Roth said were especially needed, including:

  • Phased-out subsidies on non-primary residences so they will be charged actuarially sound rates.
  • Better enforcement to ensure homes in flood-prone areas have the appropriate insurance.
  • Updating the nation’s flood maps and elevation standards to more accurately indicate flood-prone areas.
  • Incentives for mitigation.
  • Allowance for the Federal Emergency Management Agency to increase annual premiums by 15 percent – up from the current 10 percent.
  • Forgiving the program’s $20 billion debt that resulted from the 2005 hurricane season.

The legislation does not include a provision to add wind coverage to the NFIP, as the House-passed version does. “We are especially pleased the committee chose not to overburden the program,” Roth said. “Including wind in the NFIP would be bad public policy and put taxpayers on the hook for a risk the private marketplace is able to write.”

Roth urged the full Senate to pass the legislation. “We congratulate members of the committee for developing and approving this common-sense approach to reforming the NFIP,” Roth said. “This legislation will greatly benefit homeowners, who can have more confidence that a stronger flood program will be around for years to come.”

For further information, contact
Nancy Grover
(202) 628-1558 Tel
(202) 628-1601 Fax
ngrover@namic.org

Posted: Wednesday, October 17, 2007 12:00:00 AM. Modified: Wednesday, October 17, 2007 11:25:57 AM.

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