Professional Insurance Agents Issue Statement on Flood Insurance Program

WASHINGTON, June 15 -- The National Association of Professional Insurance Agents issued the following statement by National Executive Vice President and CEO Mike Becker:

"PIA understands that a deal has been negotiated on House legislation to reauthorize the National Flood Insurance Program (NFIP) that would reduce the Write Your Own (WYO) reimbursement rate from 30.9 percent to 27.9 percent, with a three-year phase-in. It also directs FEMA to reduce costs for WYOs 1.5 percent by streamlining inefficiencies. A markup by the House Financial Services Committee is set for 9:00 a.m. Thursday June 15.

"Our position is straightforward: As an agents' association, PIA will not endorse a provision which will likely result in a cut to agent compensation. Accordingly, PIA will continue to oppose this legislation.

"The WYO reimbursement is used by carriers to pay agent commissions, and most WYOs have acknowledged that, for them to remain in the program, they will likely pass any cut to the WYO rate on to agents in the form of commission cuts, similar to what was done in healthcare.

"We appreciate the House Financial Services Committee's work on this issue," said Jon Gentile, vice president of government relations for PIA.

"Unfortunately, PIA cannot support this legislation due to the cut to the WYO reimbursement rate. Doing so will ultimately hurt consumers as agents leave the program. We continue to oppose this bill and will continue to work with Congress to find a way forward on NFIP reauthorization that recognizes the crucial role independent agents play in the NFIP."