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Published on: 9/23/2005
Last Visited: 12/24/2005
Anne Canfield, executive director of the Consumer Mortgage Coalition, said as many as 40 percent to 75 percent of homes in the areas devastated by Hurricane Katrina were not insured for flood damage.But she said it was critical for Congress to provide residents with funding to repair and rebuild after flood damage so they can remain in their communities and affected areas can be rebuilt quickly.
The Consumer Mortgage Coalition represents national mortgage lenders, servicers and service providers -- an industry that is likely, according to analysts, to suffer losses from Hurricane Katrina.
"It is not clear why so many homes were not covered by flood insurance in the Katrina-affected areas," Canfield wrote in the proposal, circulated among trade groups for their comment.Owners of flooded properties may not have been located in special flood hazard areas designated by federal officials, or those areas may not have participated in the National Flood Insurance Program, the Consumer Mortgage Coalition said.Some New Orleans homeowners' properties were not within designated flood hazard areas because of the presence of levees, Canfield said.
"But whatever the reasons, the devastation caused by Katrina is unique and it calls for a unique response," she wrote."While this type of payout would clearly affect the (National Flood Insurance Program's) long-term goal of being actuarially sound, the homeowners who have lost everything clearly did not anticipate this level of damage or hardship."Canfield said the proposal had not been sent to Capitol Hill, and stressed that it is a draft.