Nation & World

Senate panel passes flood insurance bill; full Senate is next

WASHINGTON — As storm-soaked parts of the country reel from rains and floods, the Senate Banking Committee moved quickly Thursday to approve a five-year reauthorization of the National Flood Insurance Program, which expires Sept. 30.

"It is reassuring to see that in today's often-toxic politic environment it is still possible to put politics aside and work together in the interest of the American people," said Senate Banking Committee Chairman Tim Johnson, D-S.D.

The House of Representatives already has approved a bill, and Rep. Judy Biggert, R-Ill., the chairwoman of the House panel on insurance, said reaching a consensus before the program expired was "absolutely vital, especially during hurricane season."

"Any lapse in the program could cause a major interruption in the housing recovery and threaten the availability of flood protection for thousands of homeowners," Biggert said.

The beleaguered program, administered by the Federal Emergency Management Agency, is $18 billion in the red since payouts made after Hurricane Katrina in 2005.

But a Katrina-related issue — how to determine wind damage, which the federal program doesn't cover — is still pending.

Sen. Roger Wicker, R-Miss., a committee member who's been leading the fight on the wind-vs.-water controversy, secured the support of Johnson and the panel's ranking Republican, Richard Shelby of Alabama, for attaching his amendment to the bill when it goes to the Senate floor for a vote.

Wicker's amendment applies to homes left as "slabs" in a hurricane's wake, and would require the use of data from the National Oceanic and Atmospheric Administration, instead of insurance company discretion, to determine the cause of the damage.

Mississippi was ground zero for slab homes that were denied insurance payments for wind damage after Katrina. Wicker said his amendment, with the acronym of COASTAL, would protect taxpayers and policyholders from inappropriate shifting of wind damage claims to the federal flood program.

"Today's agreement is an important step to solving the wind-versus-water dispute problem," Wicker said. "While the COASTAL formula will be used to prevent overpayment for flood losses, I believe that the use of the FEMA formula and the NOAA data will have a second important national benefit, which is to help protect consumers from any industry abuses in the future."

Industry and environmental groups associated with, a group largely funded by the insurance industry, also praised the bill's committee passage.

"The new rate structure in this bill provides a market force to move development to higher ground and out of harm's way, while protecting valuable ecosystem services at the same time," said Joshua Saks, the senior legislative representative for water at the National Wildlife Federation.


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