WASHINGTON, D.C., September 27, 2007—The House of Representatives today passed H.R. 3121, the Flood Insurance Reform and Modernization (FIRM) Act of 2007. The bill, sponsored by House Financial Services Committee Chairman Barney Frank (D-Mass.) and Rep. Maxine Waters (D-Calif.), would modernize and reform the National Flood Insurance Program (NFIP).
“The Big ‘I’ strongly supports this legislation that would help consumers who are vulnerable to flooding and to shore up the National Flood Insurance Program for many years to come,” says Charles E. Symington Jr., Big “I” senior vice president for government affairs and federal relations. “This will make the flood program more actuarially sound and more effective at serving both consumers and taxpayers. We thank Chairman Frank and Chairwoman Waters for working to get this done in the House.”
The bill contains a number of Big “I”-backed provisions. Some of the new Big “I”-backed reforms included in the legislation are:
· 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
The bill also includes a provision authored by Rep. Gene Taylor (D-Miss.) that would add optional windstorm coverage to the NFIP. While the Big “I” praises Rep. Taylor for helping to spur dialogue on the important issue of the availability and affordability of windstorm coverage in coastal communities, we do have some concerns with the inclusion of such coverage in the NFIP. The Big “I” looks forward to working with all parties to ensure that windstorm coverage is affordable and available to Big “I” consumers without unduly displacing the private marketplace.
The Big “I” is especially pleased that the legislation contains provisions that increase maximum coverage limits and include optional business interruption coverage and additional living expenses, as these have been the top priorities for independent insurance agents, brokers and their customers. The increase will allow consumers to better insure against losses due to flooding. The inclusion of additional living expenses and business interruption will help consumers, both residential and commercial, whom are hurt by flooding to overcome the uncertainty often experienced immediately after these events.
“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,” says John Prible, Big “I” assistant vice president for federal government affairs. “We are also grateful that the House included the optional additional living expenses and business interruption. The security and stability that these optional purchases would provide to consumers is crucial to individuals and to small business people across America.”
Founded in 1896, 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.