Sen. Clinton Pushing Wind Cover In Flood Program

WASHINGTON--Sen. Hillary Rodham Clinton, D-N.Y., who is pushing to add wind coverage to the National Flood Insurance Program, has written the chairman of the Senate Banking Committee, urging him to support that change.

In a letter Friday to Sen. Chris Dodd, D-Mass., Sen. Clinton said she believed that adding coverage to the NFIP--as proposed in legislation passed by the House Sept. 27 as H.R. 3121--"should merit our consideration and support."

She added, "Congressman Gene Taylor, D-Miss., and others have offered a sound and responsible proposal that according to the CBO [Congressional Budged Office] would have 'no significant net budgetary impact' while providing an effective and workable solution for homeowners."

While there will continue to be a debate about the most effective approach to the current problem, "it is clear that the multiperil coverage provisions, when coupled with the effective reforms of the NFIP included in the underlying bill, would help provide an immediate option for the millions of American homeowners that are facing dwindling choices for insurance coverage," she added.

Sen. Clinton in November introduced S. 2310, a companion bill to H.R. 3121, which provides the wind coverage. However, the Senate Banking Committee has reported out different legislation to the floor, which does not provide wind coverage.

The Senate bill that was approved (S. 2284) would forgive a $17.3 billion loan the NFIP has outstanding with the Treasury, most of it stemming from paying losses from Hurricanes Rita and Katrina. The debt would be forgiven in exchange for extension of a pilot program enabling the NFIP to charge actuarially sound rates reflecting the risk to properties that have sustained flood damage on more than one occasion.

Since the measure passed Oct. 17 it has been held up by Louisiana's senators, who have expressed concern that the provision for a change in actuarial rates would make the program unaffordable to many Louisiana residents. They do support the provision to forgive the NFIP's Treasury. The House bill calls for dealing with that issue over 10 years.

Sen. Clinton said she favors the House bill because "homeowners throughout the country are increasingly facing the catch 22 of either losing access to catastrophic and homeowners insurance because the private insurers are pulling up stakes and leaving markets altogether or facing skyrocketing premiums that are prohibitive to many working families."

Ms. Clinton said the "circumstances are not unique to New York, which is why I believe the Senate should take action to ensure that there is a stabilization of the catastrophe insurance market nationwide and that the 50 percent of Americans who live within 50 miles of a coastline can continue to have access to affordable and reliable insurance that will cover all perils, including those damages incurred by hurricanes."

The program must be reauthorized by Sept. 30, when its current authorization expires.