WASHINGTON–Rates charged homeowners and businesses by the National Flood Insurance Program are based on an outdated computer model that doesn't accurately reflect the risk of losses from flooding, the Government Accountability Office said.
Its report was issued yesterday as the March 3 deadline to reauthorize the program loomed with the House and Senate so far unable to reconcile differences between the separate bills each body passed to extend and reform the program.
Asked to comment, Robert Gordon, senior vice president, policy development and research, at the Property Casualty Insurers Association of America, said that "government efforts to control insurance rates in any context tend to be subject to political pressures to under price risk."
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