House, Senate Must Work Out Differences in Flood Insurance Bills

May 14, 2008

The Senate voted Tuesday to extend until 2013 a federal program that insures millions of U.S. homes against floods and to forgive $17 billion in debt that the program built up during Hurricane Katrina.

In an issue of concern to major insurers, such as Allstate Corp and State Farm, the Senate approved renewing the National Flood Insurance Program. It voted last week against adding wind damage coverage to the program.

The House last year also voted to extend the program, but added wind coverage, and refused to forgive the debt. Negotiators from both chambers must now work out stark differences in a compromise bill to send to President Bush for his signature.

Bush has threatened to veto the House bill. The insurance industry opposes adding wind coverage to the program.

(Reporting by Kevin Drawbaugh; editing by Jeffrey Benkoe)