OVERSIGHT OF THE FEDERAL FLOOD INSURANCE PROGRAM HEARINGS BEFORE THE SUBCOMMITTEE ON HOUSING AND COMMUNITY DEVELOPMENT OF THE COMMITTEE ON BANKING, FINANCE AND URBAN AFFAIRS NINETY-FIFTH CONGRESS FIRST SESSION SEPTEMBER 7 AND 8, 1977 Printed for the use of the Committee on Banking, Finance and Urban Affairs 95-895 O U.S. GOVERNMENT PRINTING OFFICE WASHINGTON: 1977 379ST HENRY S. REUSS, Wisconsin, Chairman WILLIAM S. MOORHEAD, Pennsylvania THOMAS L. ASHLEY, Ohio FERNAND J. ST GERMAIN, Rhode Island HENRY B. GONZALEZ, Texas JOSEPH G. MINISH, New Jersey FRANK ANNUNZIO, Illinois JAMES M. HANLEY, New York WALTER E. FAUNTROY, District of Columbia STEPHEN L. NEAL, North Carolina PAUL E. TSONGAS, Massachusetts CLIFFORD ALLEN, Tennessee NORMAN E. D'AMOURS, New Hampshire HERMAN BADILLO, New York BRUCE F. VENTO, Minnesota J. WILLIAM STANTON, Ohio CHALMERS P. WYLIE, Ohio JOHN H. ROUSSELOT, California STEWART B. MCKINNEY, Connecticut GEORGE HANSEN, Idaho HENRY J. HYDE, Illinois RICHARD KELLY, Florida CHARLES E. GRASSLEY, Iowa MILLICENT FENWICK, New Jersey JIM LEACH, Iowa NEWTON I. STEERS, JR., Maryland HAROLD C. HOLLENBECK, New Jersey PAUL NELSON, Clerk and Staff Director GRASTY CREWs II, Counsel MERCER L. JACKSON, Minority Staff Director GRAHAM T. NORTHUP, Deputy Minority Staff Director SUBCOMMITTEE ON HOUSING AND COMMUNITY DEVELOPMENT THOMAS L. ASHLEY, Ohio, Chairman WILLIAM S. MOORHEAD, Pennsylvania JAMES M. HANLEY, New York WALTER E. FAUNTROY, District of Columbia JERRY M. PATTERSON, California LES AUCOIN, Oregon GLADYS NOON SPELLMAN, Maryland JAMES J. BLANCHARD, Michigan CARROLL HUBBARD, JR., Kentucky GARRY BROWN, Michigan J. WILLIAM STANTON, Ohio JOHN H. ROUSSELOT, California CHALMERS P. WYLIE, Ohio STEWART B. MCKINNEY, Connecticut RICHARD KELLY, Florida CHARLES E. GRASSLEY, Iowa THOMAS B. EVANS, JR., Delaware GERALD R. MCMURRAY, Staff Director Cheek, Leslie, vice president-Federal affairs, American Insurance Association. 272 300 Fritzel, Charles H., assistant vice president for government relations, National 292 Jordan, Donald L., assistant vice president, Alliance of American Insurers Jordan, Leo J., associate general counsel, State Farm Insurance Co., Bloomington, Ill.. 300 330 Kremer, Edward J., chairman, Federal affairs committee, Independent Insurance Agents of America 319 Maier, Peter L., Housing Research Group, Center for Study of Responsive 195 Naugle, Wayne L., president-elect of the Professional Insurance Agents; accompanied by William H. Cooke 281 Platt, Rutherford H., professor of geography and planning law, University of 472 Prokop, Ruth, General Counsel, Department of Housing and Urban Development; accompanied by J. Robert Hunter, Acting Administrator, Federal Insurance Administration Simpson, Richard W., director, Bureau of Regulation of Rates and Policies, Insurance Department, Commonwealth of Pennsylvania, representing William J. Sheppard, Insurance Commissioner of the Commonwealth of Pennsylvania, and on behalf of the National Association of Insurance Commissioners; accompanied by James H. Kilgore, P. & C. rate analyst; and Benn Prybutok, special assistant for legislative affairs Weese, Samuel H., general manager, National Flood Insurers Association; accompanied by Franklin W. Nutter, general counsel, NFIA; and Elmer F. Fisher, accountant, Touche Ross & Co... 387 227 2 ADDITIONAL INFORMATION SUBMITTED FOR THE RECORD Alliance of American Insurers, prepared statement on behalf by Donald L. 306 American Insurance Association, prepared statement on behalf by Leslie 275 Center for Study of Responsive Law, Housing Research Group, prepared statement on behalf by Peter L. Maier 201 Cheek, Leslie, prepared statement on behalf of the American Insurance Association........ 275 Department of Housing and Urban Development, prepared statement on behalf by Ruth Prokop, General Counsel 394 Fritzel, Charles H., prepared statement on behalf of the National Association of 295 Independent Insurance Agents of America, prepared statement on behalf by 322 Jordan, Donald L., prepared statement on behalf of the Alliance of American 306 Jordan, Leo J., prepared statement, with attachment, on behalf of the State 334 Kremer, Edward J., prepard statement, with attached fact sheet, on behalf of Maier, Peter L., prepared statement, with attached correspondence, on behalf of the Housing Research Group, Center for Study of Responsive Law..... National Association of Independent Insurers, prepared statement on behalf by Page 322 295 145 Platt, Rutherford H.: Prepared statement 475 "The National Flood Insurance Program: Some Midstream Perspectives," 485 Professional Insurance Agents, prepared statement on behalf by Wayne L. Prokop, Ruth: 285 Exhibit A: "Statement of Work" of the Request for Proposals (RFP) 426 453 394 Draft contract between the Department of Housing and Urban Develop- ment and the National Flood Insurers Association Letter, dated March 25, 1977, to the General Accounting Office, responding to a GAO letter of March 21, 1977, to HUD Secretary Patricia Harris .... CNA Insurance of Chicago, Ill., from Edward J. Noha, chairman of the boards and chief executive officer of the CNA Insurance Cos., dated Great American Insurance Cos., Cincinnati, Ohio, from Ronald F. 132 142 Home Insurance Co., The, Manchester, N.H., from Henry Katz, senior Weese, Samuel H.-Continued St. Paul Fire & Marine Insurance Co., St. Paul, Minn., from Waverly Prepared statement on behalf of the National Flood Insurers Association. LETTERS RECEIVED BY THE SUBCOMMITTEE FOR INCLUSION IN THE RECORD Page 130 137 127 145 Billett, John W., president, Advisors Inc., Washington, D.C., dated September 15, 1977 505 Boggs, Hon. Lindy (Mrs. Hale), a Representative in Congress from the State of 498 Filippone, Ella, executive administrator, Passaic River Coalition, Basking 503 Grimes, Gerald, insurance commissioner, State of Oklahoma, dated September 6, 1977, with attached correspondence to President Carter re proposed regulations by HUD on the flood insurance program 500 |