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House vote to encourage private flood insurance wins praise

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Insurers and other groups praised Thursday’s vote by the U.S. House of Representatives in favor of the Flood Insurance Market Parity and Modernization Act.

The House voted unanimously to approve H.R. 2901.

The measure is designed to encourage private insurers to enter the flood insurance marketplace by both easing regulations and allowing the use of private insurance to fulfill mandatory purchase requirements on loans.

Although private insurers currently underwrite commercial flood insurance, some commercial policies as well as homeowner policies are underwritten by the federal government’s National Flood Insurance Program, which is more than $20 billion in debt.

SmarterSafer.org, a coalition of insurer, environmental, free-market and other groups, issued a statement calling the bill “an excellent step in the right direction.” It said expanding competition in the flood insurance marketplace “will give buyers access to better coverage and lower rates.”

“This is the right time to pass this legislation,” Nat Wienecke, senior vice president in the Washington office of the Property Casualty Insurers Association of America, said in a statement. “Families and businesses depend on flood insurance to protect their homes, and H.R. 2901 may expand consumers’ flood insurance options.”

“The overwhelming bipartisan vote by the House creates additional momentum as the bill moves to the Senate,” Tom Santos, vice president at the American Insurance Association in Washington, said in a statement.

He noted that companion legislation already has been introduced in the Senate.