Flood Insurance Claims SwampFEMA
WASHINGTON - (10/19/05) -- Claims against the National FloodInsurance Program for hurricanes Katrina and Rita will far exceedexisting funding for the program and will require an emergencyappropriation from Congress of as much as $5 billion, an officialfor the Federal Emergency Management Agency, which runs theprogram, told Congress Tuesday. Claims are expected to reach asmuch as $22 billion, the highest ever, David Maurstad, the actingdirector of the program, told the Senate Banking Committee, duringTuesday's hearings. But several witnesses testifying at the hearingnoted that even more flood losses caused by America's worst naturaldisaster are uninsured, potentially passing on those losses tocredit unions, banks and other mortgages lenders. Sen. RichardShelby, R-Ala., chairman of the banking panel, suggested thatCongress will bail out the flood program and provide the necessaryfunding to make it solvent. "As FEMA currently lacks the reservesto pay the expected claims from Hurricane Katrina, I believebringing the insurance fund to financial solvency is necessary toassure that all claims are paid in a timely and fair manner, sothat impacted families can rebuild their lives as quickly aspossible," said Shelby.