An insurance industry group is hoping that a hold placed on a bill in the Senate to reform the National Flood Insurance Program will not derail the legislation.
Sens. Mary Landrieu, D-La., and David Vitter, R-La., placed holds on the legislation, which would have phased out subsidies for secondary residences, increased participation in the flood program and forgiven the roughly $20 billion debt owed by the NFIP to the Treasury. Among the major criticisms being leveled is that the bill would lead to higher premiums for residents along the Gulf of Mexico and that there is no provision in the House version of the bill that would expand the NFIP to offer windstorm coverage to homeowners who have purchased flood insurance.
"It is vital that the National Flood Insurance Program, which protects millions of Americans against flood damages, be renewed and improved," said Paul Kangas, director, federal government relations for the Property Casualty Insurers Association of America. "We believe that the bill which passed the Senate Banking Committee on Oct. 17 is a good bill that will enhance the NFIP and help keep it solvent while also protecting property owners across the United States."
Under Senate rules, all legislation is brought to the floor for debate by unanimous consent, and one or more senators can indefinitely block a bill by placing an objection or "hold" on the bill.
Other senators have also expressed a desire to include the windstorm provision. Sens. Charles Schumer, D-N.Y., and Mel Martinez, R-Fla., had intended to offer an amendment adding the provision to the bill during a Senate Banking Committee markup last week, but they declined to do so in an effort to ensure the bill would be approved by the committee.
Banking committee Chairman Chris Dodd, D-Conn., said the proposal had merit but expressed concern that it may have unintended costs and consequences. He suggested the proposal be studied further rather than added to the bill.
The House version of the bill has already been approved but has faced criticism from insurance industry groups who believe it would crowd out the private market for windstorm coverage. Mr. Kangas said PCI hopes the Senate bill will be allowed to come to the floor and "move forward as quickly as possible in order to keep the program in place and working for Americans in danger of flood damage."
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