Insurance-industry officials this weekend voiced strong supportfor the Obama administration's request to raise the National FloodInsurance Program's borrowing authority by 50 percent.

One industry official said it was “imperative” that Congress actpromptly to increase the borrowing authority to $30.4 billion.

Another, saying that the request is a product of prior lossesand poor pricing for flood insurance, urged that Congress includein the legislation incentives for states in flood-prone areas toimpose uniform and strengthened building codes.

A third industry official says he is not surprised at the sizeof the request because “Sandy continues to be mostly a floodingevent,” but he wondered about the chances of the request passingthrough Congress. “With everyone focused on the fiscal cliff, therequest will be a heavy lift for the industry,” the official said.“However, in the end, I imagine it will get done.”

Charles Symington, senior vice president, government affairs andfederal relations for the Independent Insurance Agents and Brokersof America, says the IIABA is pleased that President Obama includeda request in the NFIP borrowing authority in his recent Sandyemergency aid package.

Agents sell flood policies as representatives of Write-Your-Owncompanies, and also handle flood claims.

Symington says that, by all accounts, the NFIP will hit thecurrent borrowing authority limit before paying all the claimsresulting from Sandy, and an increase is necessary to ensure thatconsumers are fairly compensated for flood losses due to thishistoric storm.

“We thank the president for this move,” Symington says.

Jimi Grande, senior vice president of federal and politicalaffairs for the National Association of Mutual Insurance Companies,says, “Clearly the NFIP has an obligation to pay claims to itspolicyholders, so they will need the borrowing authority they'rerequesting.”

Grande adds, “As unfortunate as the shortfall is, it is more avestige of the program's long-held flaws. The reforms passed thisyear phase in correcting measures that should reduce the need forfuture borrowing.”

Still, Grande says, policymakers should not ignore the lessonsto be learned from Sandy and all other natural disasters. “We'renot defenseless from the weather, and the government should beproactive in passing incentives to build stronger structures.Modern building codes have proven to reduce property damage, savelives and result in lower need for disaster relief.

“As Congress and the Obama administration decide on theappropriate level of assistance, we will urge them to include theSafe Building Code Incentive Act in their final aid package,”Grande states.

Tom Santos, Vice President of federal affairs for the AmericanInsurance Association, says Sandy made it clear once again that theNFIP is in need of significant reform. “Fortunately, the billenacted this past summer goes a long way to making the changesnecessary to ensure that the program will be able to meet thefuture needs of flood victims,” Santos says.