WASHINGTON, D.C., March 27, 2007—The Independent Insurance Agents & Brokers of America (the Big “I”) applauds House Financial Services Committee Chairman Barney Frank and lead co-sponsor Rep. Judy Biggert (R-IL) for their introduction of the Flood Insurance Reform and Modernization (FIRM) Act of 2007.
The bill contains a number of Big “I”-backed provisions. Some of the new Big “I”-backed reforms included in the legislation are:
· Increasing the National Flood Insurance Program (NFIP) borrowing authority to $21.5 billion
· Increasing funding for flood map modernization
· Increasing the maximum coverage limits
· Optional business interruption coverage
· Additional living expenses coverage
· Optional replacement cost coverage for contents
· Optional finished basement coverage
· Increasing the policy flex band from 10 to 15 percent
“We are very pleased that Chairman Frank and Rep. Biggert have introduced comprehensive flood insurance reform,” says Charles E. Symington Jr., Big “I” senior vice president for government affairs and federal relations. “We hope that the Financial Services Committee and full House will move quickly to pass this vital legislation, which will not only help consumers who are vulnerable to flooding, but also shore up the NFIP for many years to come.”
In particular, the increased maximum coverage limits has been a top issue for independent insurance agents & brokers. This increase will allow consumers to better insure against losses due to flooding.
“Hurricanes Katrina and Rita clearly showed that homeowners and businesses need higher coverage limits by the NFIP in order to properly insure their properties,” says John Prible, Big “I” assistant vice president for federal government affairs. “An increase in the maximum coverage limits will better allow both individuals and commercial businesses to insure against the damages that massive flooding can cause, and we’re grateful that this increase was included.”
The inclusion of optional business interruption coverage is also crucial to Big “I” members and their commercial customers, many of whom lost their businesses in the area affected by the hurricanes last year. Additionally, the inclusion of additional living expenses will help consumers make ends meet in the immediate aftermath of a flood loss.
“Many Big ‘I’ members and the business customers they serve had to work out of their homes because their offices had been destroyed,” Symington says. “This is a prime example of why business interruption coverage is crucial to our members and to small business people across America. The additional living expenses coverage, meanwhile, will provide consumers with greater economic security during the often bewildering post-flood period.”
The Big “I” has actively supported needed reforms to the flood insurance system, including the extension of the borrowing authority and many other proposed changes. It released a comprehensive, 23-point flood modernization agenda in November, 2005. (Click here to see the Nov. 11, 2005, release.)
Founded in 1896, IIABA (the Big “I”) is the nation’s oldest and largest national association of independent insurance agents and brokers, representing a network of more than 300,000 agents, brokers and their employees nationally. Its members are businesses that offer customers a choice of policies from a variety of insurance companies. Independent agents and brokers offer all lines of insurance—property, casualty, life, and health—as well as employee benefit plans and retirement products. Web address: www.independentagent.com.