The battle over rate hikes imposed on flood insurance programpolicyholders in Louisiana is intensifying, with the big prizebeing the Senate seat now held by Mary Landrieu, D-La.

Friday, the apparent strongest contender for Landrieu's seat,Rep. Bill Cassidy, R-La., announced formation of a coalition ofmembers of the Senate and House, sans Landrieu, whose objective isto seek a rollback or delay in some of the NFIP rate increasesscheduled to go into effect in 2014 through the Biggert-WatersAct.

That announcement followed Landrieu's failed attempt lateWednesday to get a vote on an amendment that would delay some ofthe proposed rate increases for five years.

After she was denied a floor vote on her amendment, Landrieuvowed a continued effort to at least delay the rate increases.

Mississippi Insurance Commissioner Mike Chaney also called forsome relief for policyholders, "Both FEMA and Congress must find asolution to the pending high rate increases in the NFIP," he says"No states are exempt and existing policyholders should be providedsome form of relief from the draconian proposed increases. 

But some in the insurance industry point to the reasons behindthe proposed increases, and note the importance of aligning ratesmore closely with the risks faced in certain parts of thecountry.

Jimi Grande, senior vice president, federal and politicalaffairs for  the National Association of Mutual InsuranceCompanies, says, "The reforms passed under the Biggert-Waters Actwere designed to strengthen the NFIP financially through a gradualmove towards risk-based pricing, which would also provide propertyowners with a better understanding of the flood risk they areactually facing."

He said the law provided for a phase-in of risk-based rates overfive years, with an annual cap on rate increases of 20 percent forpolicy renewals.

"While it's understandable that some property owners may beupset to find out how at-risk they are, delaying the reforms doesnot reduce that risk, and could weaken the NFIP's ability to payclaims without having to borrow from the Treasury," Grandesays.

Currently, the NFIP owes $30.4 billion to the Treasury. Theborrowing authority was raised 50 percent earlier this year, fromapproximately $20 billion, in order to pay for claims prompted bySuperstorm Sandy.

The core of the battle is to retain existing rates forapproximately 525,000 properties covered by grandfatheringprovisions that barred increases for those who purchased floodinsurance before mapping began in 1974, or who were allowed to keeptheir rates when new maps showed there was increased risks offlooding in their communities. 

Until the reforms in 2012 mandated substantive increases inrates over five years, those rates stayed the same as long as theoriginal owner retained the property.

In a statement during the debate over whether she should getfloor time on her amendment, Landrieu explained the dilemma shefaced when the 2012 reforms were voted on as part of a largertransportation bill. 

"Had the Biggert-Waters Act been brought for an up-or-down vote,I would have votedagainst it," she said. Instead, it was part of thetransportation bill, including the Landrieu-sponsored Restore Act,which directs 80 percent of Clean Water Act fines paid by BP andother responsible parties for the 2010 oil spill to the GulfCoast.

Wednesday night, Landrieu's efforts to get a vote on anamendment that would delay the rate increases for five years wasrejected under a unanimous consent agreement by Sen. PatrickToomey, R-Pa.

Then, on Friday, Cassidy announced creation of a bi-cameral,bi-partisan group in Congress called the Congressional HomeProtection Caucus.

It includes a number of senators and members of Congressaffected by Hurricanes Katrina and Rita, as well as SuperstormSandy.

Its objective is to delay or stop premium hikes imposed by theBiggert-Waters legislation.

The only person not included in Cassidy's caucus of Louisiana,Mississippi, New Jersey and New York members of Congress isLandrieu. 

Cassidy is even enlisting civic leaders in New Orleans in hiscoalition. Ironically, the mayor of New Orleans, Mitch Landrieu, isMary Landrieu's brother.

In a statement, Cassidy said the express goal of the Caucus isto promote market-based solutions to make flood insuranceaffordable for coastal communities.

"This bi-partisan coalition will fight for real, common-sensesolutions to protect homeowners and their investments," Cassidysaid.

"I've been actively talking with folks across Louisiana and onething is clear – folks are outraged by the magnitude of thepotential rate increases. One of my top focuses in the Senate rightnow is working for a solution.

"We must make sure that people who have been following the rulesaren't priced out of their homes because their flood insurancerates increase so dramatically," Cassidy said.