Washington – Representative Gene Taylor (D-MS)continues to push for H.R. 1264, the Multiple Peril Insurance Actto be heard on the floor of the U.S. House of Representativesbefore the August Congressional recess. Environmental interests,consumer advocates, taxpayer watchdogs, the business community andinsurers remain strongly united with the Obama Administrationagainst this short-sighted bill.

"This proposed legislation is unnecessary and fraught withnegative consequences that will harm consumers and the marketplaceat a fragile time for our American economy," said David Sampson,president and CEO of the Property Casualty Insurers Association ofAmerica (PCI). "This approach is a mistake that could deliverdevastating results to the U.S. jobs market and add billions to thefederal deficit."

H.R. 1264 was originally scheduled for debate on the House Flooron July 22, but was ultimately delayed before it was considered.The bill could be back on the House agenda as early as this week,before Congress leaves for the August recess.

"Despite overwhelming opposition from the Obama Administration,leading environmental groups, consumer advocates and taxpayerwatchdogs, Rep. Taylor still wants the House to hear hisshort-sighted bill," said Ben McKay, PCI's senior vice president offederal government relations. "We hope that House leadership willrecognize the resounding wave of opposition that continues to growand say no to this bad public policy."

Home, auto and business insurers are strongly opposed to thisproposal to expand the National Flood Insurance Program (NFIP) toinclude windstorm insurance coverage. The Multiple Peril InsuranceAct would shift the issuance of wind insurance policies from theprivate market to the federal government. PCI has determined thatover $25 billion in private capital from homeowners insurancepremium is allocated to the wind peril every year. A governmenttake-over of this private homeowners' insurance marketplace isestimated to have the following effects:

Crushing Impact on U.S. Jobs Market

o PCI estimates that up to 41,775 private sector jobs could belost or moved to Washington, D.C. This is the equivalent of $2.6billion in lost wages that would be removed from the economy orshifted from local communities to federal government jobs.

Billions Added to Federal Deficit; Obama AdministrationOpposes

o State and federal governments could lose approximately $22.1billion in premium taxes; income taxes and municipal bondinvestments from private insurance companies.

o The NFIP is already struggling with $18.2 billion of debt(without windstorm coverage), which is a significant burden on theprogram. The interest alone on this debt costs the NFIP more than$900 million a year, none of which goes to pay back any of theprincipal.

o The Federal Emergency Management Agency (FEMA) does notsupport adding windstorm coverage to the NFIP, citing concerns thatthis would threaten the long-term viability of the program.Secretary of Homeland Security Janet Napolitano has also expressedopposition to the multi-peril proposal.

o Last week, the Office of Management and Budget released itsofficial Statement of Administration Policy opposing the MultiplePeril Insurance Act, as it would unnecessarily expand the federalgovernment's role in the windstorm insurance market.

Environmental, Consumer, Taxpayer and Business GroupsObject

o Environmental groups have expressed major concerns that thislegislation would create incentives for more development inenvironmentally sensitive coastal areas, leading to increaseddamage to wildlife habitat, wetlands and coastlines.

o In a July 20, 2010, letter to the U.S. House ofRepresentatives, groups including the Environmental Defense Fund,National Wildlife Federation and Sierra Club all urged lawmakers toreject this proposal to add windstorm coverage to the NFIP.

o The Consumer Federation of America opposes the Multiple PerilInsurance Act as it would hurt consumers by forcing greatertaxpayer subsidies and providing developers with more incentives tobuild unsafe structures.

o Taxpayer advocate groups such as Americans for Prosperity andAmericans for Tax Reform continue to sound the alarm by pointing tothe billions of taxpayer dollars needed to add windstorm coverageto the NFIP.

o The U.S. Chamber of Commerce also opposes H.R. 1264 as theproposal threatens the jobs market and the availability ofwindstorm insurance coverage in the private market.

"Home, auto and business insurers are strong and stable," saidSampson. "Insurers stand ready to serve coastal communities shoulddevastating storms develop. There is no need to addgovernment-backed windstorm insurance to the flood program."

The states along the Gulf coast and eastern seaboard are home toover $19 trillion in insured property values. Private or stateresidual markets for windstorm coverage already exist for more than99 percent of all coastal properties in the United States.Following Hurricane Katrina, additional consumer protections havebeen established for settling flood claims disputes through theimplementation of the new "appeals process" (as included in the2004 Flood Insurance Reform Act).