NU Online News Service, April 6, 3:43 p.m.EDT

WASHINGTON–Insurance industry officials said theyexpect when Congress resumes it will act quickly to renew theexpired National Flood Insurance Program.

They also said they believe lawmakers will deal with othercatastrophe issues on returning from their holiday recess.

Meanwhile, the Kansas Insurance Department said in a consumeralert today that the National Flood Insurance Program funding haltcould cause short-term problems for consumers waiting to close onthe sale of a property within a designated Special Flood HazardArea.

"The National Flood Insurance Program's federal authorizationexpired on March 28," Kansas Insurance Commissioner Sandy Praegersaid in a statement. "NFIP ceased issuing new policies or renewingpolicies then. However, consumers with current policies are stillcovered."

On April 21 a subcommittee of the House Financial ServicesCommittee is scheduled to hold a hearing on controversiallegislation that would add wind damage coverage to the floodprogram.

According to insurance industry representatives, that will befollowed the next day by the start of the markup of legislationcalling for a long-term reauthorization and reform of the NFIP.

In a letter sent late Monday to the Senate leadership, theFinancial Services Roundtable urged that chamber to passlegislation providing for "an immediate, retroactive extension" ofthe NFIP.

The letter said the "expiration of the program on March 28 hasleft thousands of homeowners and small businesses in limbo." Theletter was signed by Steve Bartlett, president and CEO of theFSR.

It added, "Until Congress acts to reauthorize the program,insurance companies cannot issue new policies, increase coverage onexisting policies, or issue renewal policies."

The program expired because Republicans in the Senate declinedto pass legislation that had earlier passed the House extending theprogram until May 31 while talks continued on legislation extendingthe program until Dec. 31.

The bill in question also contained provisions extendingunemployment insurance and postponing a 21 percent cut in payprovided doctors under the Medicare program.

The hearing involving flood insurance will be before the HousingSubcommittee of the FSC. It will discuss H.R. 1264, the MultiplePeril Insurance Act, legislation introduced last year by Rep. GeneTaylor, D-Miss.

Rep. Taylor has been pushing for several years to add wind tothe NFIP. This legislation would do that as well as make otherreforms to the NFIP program.

These reforms would include providing incentives for states toestablish stronger rules regarding construction of homes andbusinesses in flood-prone areas, as well as closing loopholes instate law that allow insurers to escape any responsibility forclaims from damage caused by both flood and water.

According to officials of the National Association of MutualInsurance Companies, the full committee will turn its attention thenext day to legislation that would provide a long-term extension ofthe NFIP.

"These two bills provide a clear choice for members ofCongress," said Jimi Grande, senior vice president of federal andpolitical affairs for the National Association of Mutual InsuranceCompanies.

"One bill will reform the National Flood Insurance Program andgive it the solid financial footing to continue providingprotection to homeowners and businesses," Mr. Grande said.

"The other would add a massive new exposure to windstorm damage,asking more Americans to subsidize coverage for beach houses andhigh-risk coastal properties, while at the same time underminingthe private market," he added.