Napolitano Opposes Expanding Federal Flood Insurance to Cover Wind
In a recent letter to the House Financial Services Committee, Homeland Security Secretary Janet Napolitano said the administration opposes extension of the National Flood Insurance Program (NFIP) to cover wind damage. NFIP is up for renewal September 30. The House committee is considering various proposals to alter the program including legislation sponsored by Rep. Gene Taylor (D-Miss.) that would allow the federal flood insurance program to cover wind damage.
“Many carriers in Florida have told the State’s insurance regulator that they would write the wind policies of insurers withdrawing from the State,” Napolitano wrote. She pointed out that federal wind coverage would adversely affect competition in the private market and would not be cheaper than coverage offered by insurance companies.
David A. Sampson, President of the Property Casualty Insurers Association (PCI), said, “While this legislation is well-intentioned, it is both unnecessary and fraught with unintended consequences, and it ultimately will not help homeowners in need.” PCI pointed out that windstorm coverage is available to 99 percent of coastal properties through industry or state sponsored residual markets.