WASHINGTON — The House hopes to hold hearings this fall on flood insurance issues and will seek to persuade the Senate to add wind coverage and other provisions to the National Flood Insurance Program, Rep. Barney Frank, D-Mass., said on the House floor this week.

Rep. Frank, chairman of the House Financial Services Committee, made these comments on the House floor Tuesday, during debate on legislation that will extend authorization for the current NFIP. Authorization for the current version has already been extended twice.

The legislation, passed by the House on Wednesday by voice vote, extends the current program until March 31, 2010.

Rep. Frank was responding to a request from Rep. Gene Taylor, D-Miss., that the House insist that provisions add wind coverage, increase the limit on flood claims from the current $250,000 and mandate that private insurers share the cost with the flood insurance program when damage is caused by both flood and water.

All these provisions are in the House bill reauthorizing the NFIP and were passed by the House in 2007. But the Senate version, passed in 2008, did not contain any of these provisions, resulting in the current impasse.

At the same time, Rep. Frank implied that the reason it was necessary to extend the program for a third time is that the Senate is balking at adding provisions that have broad support in the House but little support in the Senate.

“What happens in the Senate will be another issue,” Rep. Frank said. “But it is certainly our intention, the leadership of the committee on the majority side, once again, to work with the gentleman to extend that protection, and I hope that maybe things will change in the Senate.”

Regarding a hearing, Rep. Frank said the committee has been busy dealing with issues relating to the financial crisis, but that Rep. Maxine Waters, D-Calif., chairwoman of the committee’s Housing and Community Opportunity Subcommittee, “is very interested in this and does plan to have some hearings.”

In his comments with Rep. Frank, Rep. Taylor defended the provisions he helped gain in the House version of the reauthorization legislation.

“The bill that was proposed by the House increased the coverage amount, since it was a shock to a lot of people who had to rebuild—$250,000 just doesn't buy the kind of house that it used to buy 10 years ago,” he said.

“We took the step to end the practice of concurrent causation, where if, according to testimony before the Mississippi Supreme Court, a house was 95 percent destroyed by the wind before the water got there, the insurance companies would bill the federal government for 100 percent of the cost of the damage, as [detailed in recent oral arguments] before the Mississippi Supreme Court,” Rep. Taylor said.

He also defended the provision in the House bill adding wind coverage, which is unanimously opposed by the insurance industry.

The bill is H.R. 3139. The current reauthorization of the flood program runs out Sept. 30.

The bill also includes legislation introduced by Rep. Doris Matsui, D-Calif., that would make technical changes to the NFIP to take local, state and federal funding into account when determining flood zone designations.

According to comments by Rep. Frank on the House floor, at this time only communities with federally funded levee improvements—not state or locally funded improvements—are eligible for an A99 designation.

Due to shrinking federal participation, however, states and communities across the country are investing millions of dollars into flood infrastructure, he said.

House Financial Services Committee staffers explained that the Matsui provision will require FEMA to take this investment into account and recognize local commitment to obtaining adequate flood protection.

At the same time, the National Association of Professional Insurance Agents said it supported the extension measure.

“It is critical to extend the authorization of the flood insurance program to assure continuity,” said Brian T. Marino, co-chair of the natural catastrophe working group for the PIA.

“PIA agrees that reform measures are important to the future of the program, but getting the reforms right is critical and clearly needs further consideration,” Mr. Marino said.

He noted PIA's principal concern is that “there is no lapse in the flood insurance coverage that is vitally important for homeowners and businesses as reform measures are considered.”

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