WASHINGTON, D.C., April 21, 2010 — The Independent Insurance Agents & Brokers of America (the Big “I”) today submitted official testimony to the U.S. House of Representatives Committee on Financial Services Subcommittee on Housing and Community Opportunity hearing titled, “Legislative Proposals to Reform the National Flood Insurance Program.”
The Big “I” supports draft legislation by Subcommittee on Housing and Community Opportunity Chairwoman Maxine Waters (D-Calif.) and Ranking Member Shelley Moore Capito (R-W.V.) which would extend the program for five years and provide necessary reforms. In today’s testimony, the Big “I” generally praised the bill saying, “Though IIABA has some recommended improvements to the draft legislation, the underlying long term extension is vital to provide stability and security to consumers.”
Of particular concern to the Big “I” is the litany of short term extensions the NFIP has experienced over the last year and a half. There have been seven short term extensions in the last 18 months, and the program is once again scheduled to expire on May 31, 2010 unless Congress approves an eighth such extension or acts on a long term bill. These short term extensions have unfortunately led to two expirations of the program just in the last few months, and today the Big “I” testified that the lack of a long term extension is “of paramount concern.”
“In a time of continued economic difficulty, the last thing that a consumer who is about to purchase her first home or a small businessman about to open a new location needs to worry about is whether Congress will pass another last minute extension of flood insurance,” says Charles Symington, Big “I” senior vice president for government affairs. “We cannot emphasize this enough – our members and their customers are completely bewildered by Congress’ continual use of these short term extensions for such a vital program, and they call on Congress to step up to the plate and pass a long term extension.”
In addition to a long term extension, the Big “I” also called for the draft flood insurance legislation to be amended before Financial Services Committee consideration to modernize the NFIP by including optional business interruption and optional additional living expenses coverages on an actuarial basis.
“The NFIP has been a successful program for consumers for over 40 years,” says John Prible, Big “I” vice president of federal government affairs. “However, it is time to modernize the program for the 21st century. Allowing consumers the option to purchase business interruption insurance and additional living expenses, as can be done in the private market for other perils, will make the program more attractive to consumers and more actuarially sound.”
The full testimony is available by clicking HERE or visiting www.iiaba.net.
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, health, employee benefit plans and retirement products. Web address: www.independentagent.com.