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A LOOK AT THE NATIONAL FLOOD INSURANCE

PROGRAM: IS OHIO READY FOR A FLOOD?

FIELD HEARING

BEFORE THE

SUBCOMMITTEE ON 

HOUSING AND COMMUNITY OPPORTUNITY

OF THE

COMMITTEE ON FINANCIAL SERVICES

U.S. HOUSE OF REPRESENTATIVES

ONE HUNDRED NINTH CONGRESS

FIRST SESSION

AUGUST 17, 2005

Printed for the use of the Committee on Financial Services

Serial No. 109–51

(

(II)

HOUSE COMMITTEE ON FINANCIAL SERVICES 

MICHAEL G. OXLEY, Ohio, Chairman

JAMES A. LEACH, Iowa 

RICHARD H. BAKER, Louisiana 

DEBORAH PRYCE, Ohio 

SPENCER BACHUS, Alabama 

MICHAEL N. CASTLE, Delaware 

EDWARD R. ROYCE, California 

FRANK D. LUCAS, Oklahoma 

ROBERT W. NEY, Ohio 

SUE W. KELLY, New York, Vice Chair 

RON PAUL, Texas 

PAUL E. GILLMOR, Ohio 

JIM RYUN, Kansas 

STEVEN C. LATOURETTE, Ohio 

DONALD A. MANZULLO, Illinois 

WALTER B. JONES, JR., North Carolina 

JUDY BIGGERT, Illinois 

CHRISTOPHER SHAYS, Connecticut 

VITO FOSSELLA, New York 

GARY G. MILLER, California 

PATRICK J. TIBERI, Ohio 

MARK R. KENNEDY, Minnesota 

TOM FEENEY, Florida 

JEB HENSARLING, Texas 

SCOTT GARRETT, New Jersey 

GINNY BROWN-WAITE, Florida 

J. GRESHAM BARRETT, South Carolina 

KATHERINE HARRIS, Florida 

RICK RENZI, Arizona 

JIM GERLACH, Pennsylvania 

STEVAN PEARCE, New Mexico 

RANDY NEUGEBAUER, Texas 

TOM PRICE, Georgia 

MICHAEL G. FITZPATRICK, Pennsylvania 

GEOFF DAVIS, Kentucky 

PATRICK T. MCHENRY, North Carolina 

CAMPBELL, JOHN, California 

BARNEY FRANK, Massachusetts 

PAUL E. KANJORSKI, Pennsylvania 

MAXINE WATERS, California 

CAROLYN B. MALONEY, New York 

LUIS V. GUTIERREZ, Illinois 

NYDIA M. VELA ́ ZQUEZ, New York 

MELVIN L. WATT, North Carolina 

GARY L. ACKERMAN, New York 

DARLENE HOOLEY, Oregon 

JULIA CARSON, Indiana 

BRAD SHERMAN, California 

GREGORY W. MEEKS, New York 

BARBARA LEE, California 

DENNIS MOORE, Kansas 

MICHAEL E. CAPUANO, Massachusetts 

HAROLD E. FORD, JR., Tennessee 

RUBE ́ N HINOJOSA, Texas 

JOSEPH CROWLEY, New York 

WM. LACY CLAY, Missouri 

STEVE ISRAEL, New York 

CAROLYN MCCARTHY, New York 

JOE BACA, California 

JIM MATHESON, Utah 

STEPHEN F. LYNCH, Massachusetts 

BRAD MILLER, North Carolina 

DAVID SCOTT, Georgia 

ARTUR DAVIS, Alabama 

AL GREEN, Texas 

EMANUEL CLEAVER, Missouri 

MELISSA L. BEAN, Illinois 

DEBBIE WASSERMAN SCHULTZ, Florida 

GWEN MOORE, Wisconsin, 

BERNARD SANDERS, Vermont

Robert U. Foster, III, Staff Director 

(III)

SUBCOMMITTEE ON HOUSING AND COMMUNITY OPPORTUNITY

ROBERT W. NEY, Ohio, Chairman

GARY G. MILLER, California, Vice Chairman 

RICHARD H. BAKER, Louisiana 

WALTER B. JONES, JR., North Carolina 

CHRISTOPHER SHAYS, Connecticut 

PATRICK J. TIBERI, Ohio 

GINNY BROWN-WAITE, Florida 

KATHERINE HARRIS, Florida 

RICK RENZI, Arizona 

STEVAN, PEARCE, New Mexico 

RANDY NEUGEBAUER, Texas 

MICHAEL G. FITZPATRICK, Pennsylvania 

GEOFF DAVIS, Kentucky 

CAMPBELL, JOHN, California 

MICHAEL G. OXLEY, Ohio 

MAXINE WATERS, California 

NYDIA M. VELA ́ ZQUEZ, New York 

JULIA CARSON, Indiana 

BARBARA LEE, California 

MICHAEL E. CAPUANO, Massachusetts 

BERNARD SANDERS, Vermont 

STEPHEN F. LYNCH, Massachusetts 

BRAD MILLER, North Carolina 

DAVID SCOTT, Georgia 

ARTUR DAVIS, Alabama 

EMANUEL CLEAVER, Missouri 

AL GREEN, Texas 

BARNEY FRANK, Massachusetts 

(V)

C O N T E N T S 

Page 

Hearing held on: 

August 17, 2005 ................................................................................................ 1

Appendix: 

August 17, 2005 ................................................................................................ 41

WITNESSES 

WEDNESDAY, AUGUST 17, 2005

Berginnis, Chad, Mitigation Branch Chief, Ohio Emergency Management 

Agency and immediate past Chair, National Mitigation Policy Liaison, 

ASFPM .................................................................................................................. 18

Crecelius, Cynthia J., Program Manager, Ohio Department of Natural Resources ................................................................................................................... 21

Dozier, Derrick, Supervisor, Property and Casualty Unit, Office of Consumer 

Services, Ohio Department of Insurance ........................................................... 23

Levengood, Patty, Director, Tuscarawas County Homeland Security and 

Emergency Management Agency ........................................................................ 25

Maurstad, David I., Acting Director and Federal Insurance Administrator, 

Mitigation Division, Federal Emergency Management Agency, Department 

of Homeland Security .......................................................................................... 3

Metzger, Terry, Commissioner, Tuscarawas County, Ohio Commission ............ 9

Quinlin, Richard, Coordinator, Belmont County, Ohio Emergency Management Agency ......................................................................................................... 26

Roskovich, Elaine, flood victim ............................................................................... 15

Upson, Rev. Karen, Director, Ohio Valley Relief Center and Donation Management, Belmont County, Ohio ......................................................................... 27

Wilson, Hon. Charles, Ohio State Senator, 30th District ..................................... 7

APPENDIX 

Prepared statements: 

Ney, Hon. Bob ................................................................................................... 42

Berginnis, Chad ................................................................................................ 44

Crecelius, Cindy ................................................................................................ 61

Dozier, Derrick .................................................................................................. 71

Levengood, Patty .............................................................................................. 75

Maurstad, David I. ........................................................................................... 77

Metzger, Terry .................................................................................................. 86

Quinlin, Richard ............................................................................................... 88

Roskovich, Elaine ............................................................................................. 89

Upson, Karen .................................................................................................... 91

Wilson, Charles ................................................................................................. 93

(1)

A LOOK AT THE NATIONAL FLOOD 

INSURANCE PROGRAM: IS OHIO 

READY FOR A FLOOD? 

Wednesday, August 17, 2005

U.S. HOUSE OF REPRESENTATIVES, 

SUBCOMMITTEE ON HOUSING

AND COMMUNITY DEVELOPMENT, 

COMMITTEE ON FINANCIAL SERVICES, 

Washington, D.C. 

The subcommittee met, pursuant to notice, at 10:00 a.m., in the 

McDonald/Marlite Conference Center, 143 McDonald Drive, S.W., 

New Philadelphia, Ohio, Hon. Bob Ney [chairman of the subcommittee] presiding. 

Present: Representative Ney. 

Chairman NEY. Today the Subcommittee on Housing and Community Opportunity meets here in New Philadelphia, Ohio, for its 

first field hearing of the 109th Congress to continue its review and 

oversight of the National Flood Insurance Program. This hearing 

will focus on how State and local governments operate under the 

National Flood Insurance Program (NFIP), and the steps being currently taken by the Federal Emergency Management Agency 

(FEMA), local officials, and the insurance industry to resolve problems dealing with inconsistencies and delays inherent to the program. In addition, our hearing will investigate current implementation difficulties in counties such as Tuscarawas, Ohio; specifically, 

how implementation of the Flood Insurance Reform Act has affected constituents and local organizations. 

Our Committee is the Financial Services Committee and the 

Subcommittee that I chair is the Housing and Community Opportunity Subcommittee. Maxine Waters of California, by the way, is 

the Ranking Member of that subcommittee. The Full Committee is 

chaired by Mike Oxley of Ohio, and Barney Frank of Massachusetts is the Ranking Member. Last year, our subcommittee and the 

Full Committee spent considerable time and effort on legislation to 

reauthorize and reform the National Flood Insurance Program. On 

June 30, 2004, President Bush signed into law the Flood Insurance 

Reform Act. This legislation reauthorizes the National Flood Insurance Program through September of 2008. 

During deliberations on the reauthorization legislation, many 

concerns were raised across the United States regarding the administration of the program. And these concerns were brought to 

the attention of FEMA. Policy holders often did not have a clear 

understanding of their policy; insurance agents often did not underVerDate 0ct 09 2002 17:30 Sep 25, 2006 Jkt 029944 PO 00000 Frm 00007 Fmt 6633 Sfmt 6633 F:\DOCS\29944.TXT HFIN PsN: TERRIE
2

stand what they were selling or how to process claims correctly; 

many policy holders did not know of or understand the appeals 

process; and many questioned the adequacy of payments ad the adjustment system. A lack of coordination between private insurers, 

NFIP and FEMA, and inadequate training were listed as possible 

sources for some of the administrative problems affecting the program. 

Since the enactment of the Flood Insurance Reform Act, members of Congress have continued to hear from their constituents 

who are frustrated with the NFIP, with the Act. This subcommittee 

has continued its oversight in an effort to address many concerns 

that continue to be raised regarding the administration and implementation of the program. We have had hearings in Washington, 

D.C., so this is an official House hearing, and without objection, 

written statements can be entered for the record. And this will be 

the third in a series of hearings on this issue. 

Floods have been and continue to be one of the most destructive 

and costly natural hazards to our Nation. During this past year 

alone, there have been three major floods in my district in eastern 

Ohio. All three of these incidents qualified for Federal flood relief 

granted by the President. And here in this county, as we all know, 

about 7,000 people had to be evacuated. I see many faces in the 

room, local officials, legislative officials, and EMA, whom we 

worked with. Other counties were affected, Dick Quinlin is in the 

audience from Belmont and he went through floods for about 22 

years or so, but the three floods last year were pretty horrific 

around many parts of the 18th Congressional District. Recent flooding in January resulted in historic levels in several local dams. And 

of course, in Tuscarawas County, as I mentioned, three communities were forced to evacuate which displaced about 7,000 people. 

I was able to witness firsthand this devastation in Guernsey County and Belmont and many other counties throughout the District. 

By the way, I have also traveled to other Members’ districts with 

hurricanes in Florida and we have seen incredible devastation also 

across the United States. 

The National Flood Insurance Program is a valuable tool in addressing the losses incurred throughout the country due to floods. 

It assures that businesses and families have access to affordable 

flood insurance that would not be available on the open market. 

Prior to the passage of the National Flood Insurance Act in 1968, 

insurance companies generally did not offer coverage for flood disasters because of the high risks involved. Today, almost 20,000 

communities participate in the National Flood Insurance Program. 

More than 90 insurance companies sell and service flood policies, 

and there are approximately 4.4 million policies covering a total of 

$620 billion. 

Last year’s Flood Insurance Reform Act achieved significant reforms to this important Federal program and I look forward to 

hearing from all of our witnesses today as we discuss how best to 

implement the legislation as well as determine whether new reforms and initiatives are in order to compliment the work that we 

did last year. 

I want to thank David Maurstad from FEMA, who is here and 

who has participated in all of our hearings on flood insurance to 

3

this date. I also want to thank our Senator Charles Wilson and 

also Commissioner Kerry Metzger is here on behalf of all the Commissioners. I just saw Commissioner Abdul and I was talking to 

him about this issue about an hour ago. Also, while Commissioner 

Chuck Prost on behalf of the Belmont County Commissioners, 

could not be here today, he did submit testimony that will be part 

of the official hearing record. And I want to thank all of our witnesses, local officials, local mayors, and citizens as we continue our 

oversight of this important Federal program. 

This hearing is important because we can take this back to 

Washington as part of the official record. 

Before we begin, I wanted to let all the gentlemen on this panel 

introduce themselves. They all come from Washington, D.C., which 

we really appreciate, and they are the nuts and bolts. As you know, 

as elected officials, you have all the people who are there and do 

all the work, I guess, and the processing of everything and the 

thinking. I just want these three individuals, we will start with 

Jeff Riley, to introduce themselves and tell you what they do. 

Mr. RILEY. Hello. I am Jeff Riley, I am with the Minority part 

of the committee. I am representing Barney Frank and Maxine Waters. Thanks for being here today. 

Chairman NEY. Thanks. 

Mr. JOHNSON. I am Tallman Johnson. I work for Congressman 

Bob Ney on the Financial Services Committee. 

Mr. KANGAS. I am Paul Kangas. I work for Chairman Mike Oxley 

of the full Committee on Financial Services, where I work on flood 

insurance issues for him. Chairman Oxley extends his thanks also 

for being here today. 

Chairman NEY. We will begin with our first panel of David 

Maurstad, who is the Acting Mitigation Director and Federal Insurance Administrator for the Emergency Preparedness and Response Directorate of FEMA within the Department of Homeland 

Security. His areas of oversight include the National Flood Insurance Program, National Earthquake Hazards Reduction Program, 

the National Dam Safety Program and the National Hurricane Program. 

Thank you. 

STATEMENT OF DAVID I. MAURSTAD, ACTING DIRECTOR AND 

FEDERAL INSURANCE ADMINISTRATOR, MITIGATION DIVISION, FEDERAL EMERGENCY MANAGEMENT AGENCY, DEPARTMENT OF HOMELAND SECURITY 

Mr. MAURSTAD. Good morning, Chairman Ney. I am David 

Maurstad, the Acting Director and Federal Insurance Administrator of the Mitigation Division in FEMA and I want to thank you 

for this invitation to appear today before your subcommittee to talk 

about the National Flood Insurance Program. 

As you indicated, over 37 years ago, the NFIP was established 

to reverse the trend of rising costs to communities, States and the 

Nation from flood disasters. Prior to the NFIP, flood insurance was 

expensive and largely unavailable. Further, community management of flood risk was not an established practice. Today, there are 

over 4.7 million policies issued for citizens living and working in 

over 20,072 participating communities. The State of Ohio has 726 

4

of those participating communities with nearly 37,000 flood insurance policies in effect providing over $4 billion worth of coverage. 

After humble beginnings, the NFIP has now become the largest 

single-line property insurance writer in the United States. 

The NFIP is designed to provide a reasonable method of sharing 

the risk of flood loss that requires balancing competing demands 

and discouraging unwise development, while providing affordable 

insurance to offset individual property owner risk. The Federal 

Government assumes a significant portion of the risk by managing 

the National Flood Insurance Fund, while the insured still retains 

a portion of the risk through deductibles and coverage limitations. 

Participating communities are required to reduce their risk of flood 

loss as a condition of making affordable flood insurance available 

for their citizens. 

I believe we have been successful in achieving that balance. I am 

proud to state that the more than 20,000 participating communities 

that I referenced earlier that have adopted and enforced construction standards that save over $1 billion annually in avoided flood 

damages. In fact, one of the most successful components of the 

NFIP is the Community Rating System. CRS is a voluntary incentive program that provides flood insurance premium discounts in 

communities where floodplain management activities exceed the 

minimum NFIP requirements. 

I am also pleased to note that the NFIP annually pays policy holders an average of between $750- $800 million in claims payments. In catastrophic years such as last year, we have paid as 

much as $1.7 billion. Ohio policy holders received more than $35 

million in flood insurance claim payments last year. Over the past 

5 years in Ohio, the NFIP has received more than 4,500 claims and 

paid out nearly $62 million in flood insurance claims. The program’s ability to provide this resource reduces the taxpayer burden 

for disaster assistance and clearly meets our objective of distributing more fairly the economic burden of flood risk in the United 

States. 

Another strength of the program is NFIP partnerships. As you 

indicated, over 96 private insurance companies known as Write 

Your Own (WYO) companies, sell and service approximately 95 

percent of the existing policies in force. It is the responsibility of 

these Write Your Own companies to manage NFIP policies as a 

part of their insurance portfolio and it is the NFIP’s responsibility 

to ensure their effective performance. FEMA, through its various 

audit programs, routinely conducts over 70 audits of WYO companies a year to ensure consistent program delivery and policy management. FEMA conducts claim reinspections of WYO companies to 

ensure their compliance with program standards and directives. If 

errors are discovered in the audit process or during claims reinspections, FEMA works with the WYO company to put procedures in place to make sure the errors do not reoccur. FEMA conducts workshops for both adjusters and agents that address underwriting and claims issues. 

Also immediately after a major event, FEMA provides a briefing 

to the adjusters in the area regarding local conditions and continues to provide guidance as needed. Insurance specialists are detailed to FEMA Joint Field Offices (JFO) to assist policy holders 

5

with their questions during recovery. For example, after the February 15 flooding disaster declaration in Ohio this year, NFIP staff 

at the JFO established a flood insurance task force comprised of 

FEMA JFO staff and State staff to address NFIP issues associated 

with the disaster. Flood Risk Information Open Houses were conducted by FEMA regional staff and the Ohio Department of Natural Resources staff to educate the public on the specific flood risk 

they are facing, inform them of ways to reduce that flood risk, and 

highlight the benefits of the NFIP. Local official meetings were 

held to educate Floodplain Administrators and community and 

county officials on the role that the preliminary Flood Insurance 

Rate Maps play in floodplain management. 

We have also partnered with our State counterparts to help us 

implement the NFIP. For example, the State of Ohio has incorporated effective local floodplain management programs into its criteria and evaluation of all Hazard Mitigation Grant Program, PreDisaster Mitigation Grant Program, and Flood Mitigation Assistance Program applicants. State policy requires effective local floodplain management as a condition for communities to receive mitigation funding. The policy promotes sustainability and avoids the 

damage-repair-damage cycle that occurs if risk reduction standards 

and strategies are not developed and implemented. NFIP information has been included in packets for local officials at mitigation 

briefings. Over 25 briefings were held from March 8th through 

March 31st this past year in Ohio. 

Nonetheless, as you indicated, we recognize there is room for improvement. FEMA is committed to ensuring that all agents are provided the necessary tools to provide policy holders timely, comprehensive, and accurate information on the coverage afforded by 

their policies. As I stated at the April 14th hearing before this subcommittee, we are providing a robust program of flood insurance 

training for insurance agents via live seminars across the Nation 

and online training modules available to agents at any time. Both 

beginning and advanced flood insurance training topics are provided to interested agents. In most States, agents earn continuing 

education credits for attending the NFIP training seminars. As we 

work with the State insurance commissioners, such as Ann Womer 

Benjamin, to implement section 207 of the Flood Insurance Reform 

Act of 2004, more agents will take advantage of these training opportunities to fulfill their State’s new mandatory flood insurance 

training requirements. 

Consistent with the Flood Insurance Reform Act of 2004, we 

have developed a comprehensive information package for all new 

and existing policy holders that provides easy-to-understand information on NFIP coverage, regulations, and procedures. This package features plain language forms developed to help policy holders 

understand their flood insurance coverage. 

However, I have noticed that the NFIP is hindered in some cases 

by a fundamental misunderstanding of its intent. For example, 

some policy holders believe that if they carry flood insurance coverage with a $250,000 limit on their dwelling, they are entitled to 

a claims payment for that amount regardless of the actual flood 

damages sustained. Another common misperception is that flood 

insurance coverage should fully restore policy holders to pre-flood 

6

condition. My review of the program since its inception clearly indicates that the NFIP was never intended to fully restore policy holders to pre-flood condition. It was designed to help them recover. 

FEMA has been working in cooperation with insurance industry 

representatives to fulfill the requirements of Title II and starting 

October 1, 2005, several new documents will be distributed to NFIP 

policy holders at the time of policy purchase, renewal and upon reporting a claim. Specifically, the summary of coverage, claims 

handbook, the loss history, and the acknowledgement of receipt of 

materials will enable policy holders to gain a clear understanding 

of coverage and claims procedures. Insurance agents will be informed by the insurance companies they represent of these materials and will be offered training on them to answer policy holders’ 

questions. In addition, many insurance companies are planning to 

reinforce their flood insurance customer service operations with 

staff members prepared to address flood insurance inquiries on the 

new material. 

As you are well aware, Title II also includes additional agent 

training requirements. The subcommittee’s hearing last April also 

identified agent training as an area in need of improvement. FEMA 

has been coordinating with the National Association of Insurance 

Commissioners and the insurance industry to establish and publish 

minimum flood insurance training and education requirements for 

all agents who sell flood insurance policies. Because State insurance commissioners have the authority for insurance agent licensing and continuing education requirements, FEMA’s role is to establish the training course content that enables agents to have a 

good understanding of the NFIP, to offer incentives whereby 

trained agents receive sale leads from FEMA’s advertising campaign and larger cost shares for their own flood insurance advertising activities, and provide technical assistance to the States. 

FEMA conducted a webcast teleconference for all State insurance 

commissioners, licensing directors, and other staff on July 13, 2005. 

This was the third NFIP webcast teleconference for State insurance 

departments since August 2004, wherein FEMA offered assistance 

to State insurance department staff. FEMA staff members are 

available to meet individually with any State insurance department to provide specialized training to the staff members. And I 

might add, we had 46 States involved in that last webcast. 

The flood hazard identification component of the NFIP is also undergoing a major overhaul. 

The Ohio Department of Natural Resources serves as the NFIP 

State Coordinating Office. Through this office and the partnership 

FEMA has built with the State, direct technical assistance is provided to each Ohio community that participates in the NFIP. 

FEMA has worked closely with State organizations such as the 

Ohio DNR and our many other stakeholders and partners to implement a major initiative of modernizing the Nation’s flood maps. 

Since fiscal year 2003, FEMA has provided over $133 million to 

Cooperating Technical Partners, like Licking County, Ohio, who 

are working with FEMA to develop the flood hazard information for 

their communities. 

7

In fiscal year 2005, we plan to initiate studies for close to 500 

additional counties, which will bring the total number of counties 

that will have flood hazard map updates underway to nearly 1,300. 

So to conclude, I want to thank you, Chairman Ney, for holding 

this field hearing in the beautiful State of Ohio, and I would also 

like to thank your subcommittee for its oversight, which in fact the 

diligent oversight of this committee has helped the program become 

successful and will make it even stronger in the future. 

[The prepared statement of Mr. Maurstad can be found on page 

77 of the appendix.] 

Chairman NEY. Thank you. Before we move on, I wanted to recognize Representative Sayer, who is also here in the audience. Representative Sayer represents this county and two other counties. 

Next, we have State Senator Charles Wilson, who is an elected 

member of the Ohio State Senate, having taken office this past 

January. He’s from Belmont County, previously a State Representative for the 99th House seat and also a small business owner, Wilson Funeral Home. 

We are very happy to have Senator Wilson 

STATEMENT OF THE HONORABLE CHARLES WILSON, OHIO 

STATE SENATOR, 30TH DISTRICT 

Mr. WILSON. Thank you, Chairman Ney. 

Good morning and thank you for the opportunity to speak this 

morning and discuss the issue of flood insurance and how it affects 

the citizens of Tuscarawas County and this region. 

Last September, the flood waters came and washed away the 

dreams, the hard work and, for some, their only possession. You or 

I might see a shingled house with a mailbox, but for the homeowner, it was where they grew up, where their parents were born, 

and in many cases where memories were made and where life was 

simple and away from this hectic world. And in the blink of an eye, 

rising waters moved foundations, cracked walls, and with the force 

of Mother Nature destroyed a home in a matter of hours. The 

neighbors helped each other, friends carried boxes, relatives 

pitched in and brought food, all in hopes that their lives could be 

put back together. Fire departments worked countless hours and 

volunteers showed their generosity that has many ways and many 

names and a boundless hope for the future. 

Congressman Ney and I joined then-State FEMA Director Dale 

Shipley and Dick Quinlin in Belmont County and flew in a helicopter over parts of the area to see first hand the devastation and 

the magnitude of the flood waters. I visited Belmont, Jefferson, and 

Columbiana counties to see the residents and how the effects of the 

flooding would happen. 

What I found was confusion, and, on the minds of the citizens 

who were attempting to put back their lives, total frustration. 

Speaking with Joe Bachman, Tuscarawas County engineer, he described a system of eligibility that depended on personality rather 

than facts. In my opinion, we must communicate the procedure and 

depth of our services at the beginning rather than offering misinformation and bureaucracy. He also explained that our flood maps 

are next to worthless and they need to be updated. I can see that 

the prospective homeowner would be paying the additional cost to 

8

survey the property to determine its flood status, or that they may 

be needlessly paying it for years because the maps were inaccurate. 

Also, there is a communication gap between Federal, State, and 

local governments because of a lack of enforcement in floodplain 

rules. Since Tuscarawas County does not require a building permit, 

nor does it have zoning in many of the affected areas, developers 

and homeowners are taking their chances and are unsure of their 

need for flood coverage. 

I support the message of Patty Levengood, Director of 

Tuscarawas County Homeland Security and EMA, who will be 

speaking here this morning, that there is confusion on the part of 

homeowners as to their coverage. When a disaster occurs, we need 

to have answers and communications systems in place to direct 

residents, not giving them an 800 number and ultimately winding 

up with an answering machine. 

I also offer you the insight of Mike Wallace of Belmont County, 

who is a 30-year veteran of the fire department and currently the 

floodplain coordinator in Belmont County. He believes that both 

the insurance agents and the homeowners need to be educated on 

the National Flood Insurance Program. He witnessed firsthand 

how renters who lost items in recent floods received settlements 

and homeowners, whom you would think would be eligible, received 

nothing. 

I have with me an example of an invoice basically for the renewal of flood insurance, showing that in many cases there is a 

$5,000 deductible, showing in many cases that it is only for replacement cost and that it be mandatory that this replacement cost 

be done in a certain way. There seems to be a real disconnect of 

the dots between the insurance owner and the person they buy 

from and the reality of what the insurance will do. 

Also, I found that the insurance companies view a basement differently than a homeowner does. The company sees a concrete floor 

with a water heater and a washtub. The homeowner has a recreation room with carpet, computer desk for kids, and an entertainment system. Many times it may be a mother-in-law suite so that 

she can be close to her grandchildren. Once flooding occurs, this 

area is destroyed and unusable. The homeowner finds out that little, if any, of this is covered. They find out that the premium of 

$400 to $600 a year that they have been paying for flood insurance 

for the past 10 years was only for replacement cost, not for damage. They receive little if any compensation and are frustrated for 

months waiting for an answer. 

I hope that we can address this communication gap and the level 

of education to all parties with the insurance issue. Last year, we 

stood in the mud and witnessed the effects of the rushing water. 

We know that our response and effectiveness was critical to our 

constituents. Today, we see that the bridge here in Tuscarawas 

County on County Road 19 is beginning construction, and countless 

roads and parts of our infrastructure all over southeastern Ohio 

are not fixed. 

Our goal should be to put people’s fears to rest by protecting 

their property. My testimony, along with others here today, should 

give you some insight and personal examples to the problems that 

face residents regarding issues of insurance. 

9

I look forward to working and improving your agencies’ methods 

so that we can be more responsive and more effective to the people. 

Thank you for this opportunity to testify. 

[The prepared statement of Sen. Wilson can be found on page 93 

of the appendix.] 

Chairman NEY. I want to thank Senator Wilson for his time and 

attention to this issue and for testifying today. 

Next is Commissioner Kerry Metzger. He serves as Commissioner for Tuscarawas County, and chairs the legislative committee 

also for the Association of County Commissioners of Ohio. He is a 

former State Representative, a hard working guy in the area, and 

a dentist by profession. 

Thank you, Commissioner. 

STATEMENT OF TERRY METZGER, COMMISSIONER, 

TUSCARAWAS COUNTY, OHIO COMMISSION 

Mr. METZGER. Thank you, Mr. Chairman, and I welcome you and 

your subcommittee to Tuscarawas County. 

I want to thank you for the opportunity today to provide public 

testimony on the National Flood Insurance Program and its impact 

here in Tuscarawas County, especially in light of the recent flooding issues we have had throughout the county. 

While I have not had any direct personal experiences with the 

National Flood Insurance Program, I have had conversations with 

our Director of the Tuscarawas County Homeland Security and 

Emergency Management Agency, Patty Levengood, regarding the 

frustrations and the confusion the county residents have experienced with the program, as she has conducted local damage assessments throughout the county. 

Director Levengood has told me that the general public has a 

general lack of knowledge and understanding of the different forms 

of insurance that could cover claims brought forth by a flooding 

event. Most are unaware of what their coverage is until after the 

disaster has occurred and when help is most needed. Unfortunately, it is then that they are informed, after the fact, that their 

claims are denied because they did not have the proper insurance 

coverage at the time of the event. 

I would wager that a majority of homeowners are unaware that 

their regular homeowner’s insurance does not cover their property 

from flood damage. Or that, even if they had some form of flood insurance coverage, that it may not cover them for sewer backup or 

earth movement damage, even though the damage may have been 

caused by the flooding incident. The property owner, more often 

than not, believes that this is part of their regular homeowner’s insurance or their flood insurance policy, not knowing that this additional coverage needed to be obtained with the purchase of riders 

to their insurance policy. The system is too confusing and complex 

and it is no wonder people get frustrated and angry with government officials or private insurance agents when their claims are denied. 

That is why I believe that the system should be simplified. Instead of having to go to multiple sources to obtain essential coverage for flooding, sewer backup or earth movement, a system 

should be created where this type of disaster coverage can be obVerDate 0ct 09 2002 17:30 Sep 25, 2006 Jkt 029944 PO 00000 Frm 00015 Fmt 6633 Sfmt 6633 F:\DOCS\29944.TXT HFIN PsN: TERRIE
10

tained from a single source—a one-stop shop, if you will. The consumer will benefit from having the myriad of insurance options explained to them once and then can make informed decisions on the 

risks they are prepared to assume and the coverage they wish to 

obtain. 

Should this not be feasible, then I would recommend that the 

governmental agencies like FEMA, and the private insurance industry, the agencies and the agents, be mandated by law to discuss, explain, and inform the general public on the insurance coverage options that may affect flooding issue claims prior to the consumer obtaining flood insurance. This will allow the consumer to 

become better educated and informed about their insurance coverage and allow them to make better proactive, rather than reactive, decisions regarding their potential flood insurance claims. 

Again, thank you for the opportunity to testify before the subcommittee, Mr. Chairman. 

[The prepared statement of Mr. Metzger can be found on page 86 

of the appendix.] 

Chairman NEY. I want to thank the Commissioner for his testimony. 

I have also noticed Lisa Duval is here from Congressman 

Strickland’s office. Thank you, Lisa. 

I just have a few general questions and what I wanted to ask of 

Mr. Maurstad is can you explain the difference once again between 

replacement cost coverage and actual cash value coverage under 

the flood insurance policy? Because I think this is something that 

is confusing. So again, that would be the difference between replacement cost coverage and actual cash value coverage. 

Mr. MAURSTAD. Well, Chairman Ney, replacement cost coverage 

is available on the dwelling of a flood insurance policy, first of all. 

And I am going to make a distinction that it is not available on 

the contents. The contents coverage is always on an actual cash 

value basis. Replacement cost coverage can be afforded on the 

dwelling if the insured purchases insurance that represents 80 percent of the insured value of the property. If that is done, then the 

loss would be covered on a replacement cost basis. The adjuster 

would go in, look at the covered damaged property, determine what 

it would cost to repair or replace that damaged property and reimburse the policy holder for that amount, less the policy holder’s 

chosen deductible on the property—or on the policy. 

For a loss that is not adjusted under the replacement cost provision—if a policy holder did not purchase 80 percent of the insured 

value of the property—that loss would be covered on an actual cash 

value basis. Let me use an example, to repair or replace the damaged property would be $10,000. But instead of paying that amount 

less the deductible, under the actual cash value scenario, depreciation would be determined for that damaged property, and let us 

just for example say that the depreciation factor was 50 percent. 

In that case, then the policy holder would receive the $10,000 

minus the $5000 depreciated amount, so the policy holder would 

receive $5000 less their deductible in that scenario. 

That is why we are encouraging people to insure to value for a 

flood insurance policy, the same as they insure to value on their 

homeowner’s policy. The testimony provided earlier was right on 

11

the mark; there are in fact two issues that we are stressing in our 

public awareness campaign, Flood Smart, which is a nationwide 

public awareness campaign for the NFIP program—two issues. 

One, we are stressing to any individual property owner across the 

country that a flood could happen to them wherever they are. It 

does not just happen in hurricane alley, it does not just happen 

right up next to a river or a stream. So, number one, we are stressing that a flood can happen to them. 

And second, that a normal homeowner policy does not cover them 

for flood loss and that they need to purchase a separate flood insurance policy, not a rider on their homeowner policy, but a separate 

flood insurance policy from an agent in their participating community. 

So we are stressing those two factors that we believe will go a 

long way toward a better understanding of the program. 

Chairman NEY. What responsibility does FEMA have to ensure 

the performance of the claim adjusters? Is there any responsibility 

within FEMA? 

Mr. MAURSTAD. It is a shared responsibility, sir, with the Write 

Your Own companies who, through their arrangement with the 

program, agreed to have their losses under the NFIP program be 

adjusted on the same basis and under the same scenario that they 

would handle losses to their non-flood portfolio. So, we audit the 

Write Your Own companies, we do reinspections of losses of Write 

Your Own companies to make sure that they are following our procedures and practices. But I would say that through the arrangement that we have with those 96 private insurance companies, 

they are the first line of responsibility here in making sure that 

their adjuster employees or the contractors that they utilize to adjust claims on their behalf and the program’s behalf are doing so 

appropriately. 

Chairman NEY. The new law establishes a pilot program for repetitive loss properties. Would you like to comment on that pilot? 

Is it geared up? And what it does for repetitive loss for citizens that 

have that type of situation. 

Mr. MAURSTAD. Well, we have been involved in addressing repetitive loss properties for well over a decade through the Flood Mitigation Assistance Program, which has been funded from the fees 

of policies that are purchased. We are in the process, we continue 

to be in the process of developing the repetitive loss pilot program 

that was a part of the reauthorization last year and we—Undersecretary Brown, Secretary Chertoff, the Administration, is committed 

to repetitive loss and the positive effects that it can have in the 

damage-repair-damage cycle of those properties that continue to be 

put at risk. And we are hopeful to continue to make progress on 

getting that program implemented. 

Chairman NEY. A final question I have, I just wanted to note 

that on April 14th, we had a flood insurance hearing in Washington, Congressman Dutch Ruppersberger of Maryland strongly 

suggested that policies should be written in plain English, which 

is what I think other officials have stated. Are Ohioans—well, not 

only Ohioans, but the Nation—getting their policies in plain 

English? I know there are certain legal items that have to be written and everything, we all know that. Any comments from anyone? 

12

Do you think there are ways we could actually sit down and try 

to get this—I know Panel II when they come here are going to say 

some things that we want to be able to take what they are saying 

that did not work and through this hearing be able to try to literally go in and correct those types of things. So do you think there 

is a way that things could be written easier? 

Mr. MAURSTAD. Chairman Ney, let me lead off and then I will 

pass the microphone. I would say that the NFIP policy was written 

so that it would coincide with a homeowner policy and what is considered to be the plain English format for insurance policies a few 

years ago. 

We are, as you are well aware, through the reauthorization, developing additional tools that will go along with that policy that 

will be written, I believe, in even plainer English, so that some of 

those issues that have been raised in the past and continue to be 

raised will be addressed starting October 1st and into the future. 

But I would also submit that as a former insurance agent for over 

20 years, whether it be funeral directors or dentists or homeowners 

that I insured, you needed to sit down regularly and have discussions between the agent and the policy holder, whether it be a 

small business owner or a homeowner and discuss the provisions 

of that policy, because as you indicated, that policy is a contract, 

it is a two-party contract between the company and the policy holder. And so that is what I continue to encourage, that people contact 

their agent and that the agent provide the necessary services to 

that policy holder so there is a better understanding of what is 

being purchased, what is covered, what is not covered, what the deductible is, and the various provisions that are important that 

come up time and time again, such as the basement issues and the 

sharing of the burden for that part of a property that is below the 

base flood elevation, that is the most likely part of that structure 

to be flooded. So that communication I believe best occurs over that 

kitchen table or over that business owner’s desk. 

Mr. WILSON. If I may, Mr. Chairman, in discussing it with an insurance agent back home and asking him what he felt some of the 

issues were, some of it he felt were the expectations of the people 

who bought the insurance. Sometimes even though they were told 

this is not replacement or whatever, however it was going to be, 

they had their own sort of profile on what it really meant. So I 

think some of it is a misunderstanding from the boilerplate, if you 

will, of how difficult it is to understand, and then second, the expectations of the people buying it. And third, I think it is exacerbated by the fact that it happens at a bad time when people are 

emotionally upset and seeing everything, as I said in my testimony, 

being washed away, things that perhaps do not have a dollar value 

but they really do have an emotional value. I think that is a part 

of it. 

And one of my concerns that I mentioned in my testimony also 

is the updating of the maps so that we have maps that if this is 

in the 100 year floodplain, that it be said that way and it is something that I think could be very helpful. 

Chairman NEY. I just wanted to comment on the maps. We have 

had a hearing in Washington on the maps and now the appropriators did something I just read the other day about monies that 

13

they were going to put in or not put in. During the hearing, basically it was pointed out—not to go into every detail of it, but one 

side of it is that maybe these companies are out here and one company had digitized England and maybe those companies should do 

this work that is more up to date. Then again, local communities 

would have to purchase that, they would almost have like a copyright. 

But there was a question of what can be mapped, what cannot 

be mapped, but obviously trying to bring everything up to modernization. Because there are some areas, and we have got a case 

right now in Belmont County where someone says this is a new 

line, the owners that want to put some jobs in there have to dispute that themselves, you have to almost have a civil engineer and 

90 days to do it. So the county commissioners are taking a look at 

trying to help with that. But if there was an up-to-date map, it 

would not have been anybody guessing whether this is a flood zone 

or not. So the mapping issue is huge that you mentioned, and we 

are trying to work with it. 

I think FEMA said during the testimony that within ‘‘X’’ amount 

of months, there were some upgrades that they were doing, but it 

is a huge issue in Washington that we are trying to address. 

Mr. WILSON. Mr. Chairman, may I ask is there funding to help 

the Commission with trying to address this? 

Chairman NEY. With our committee? 

Mr. WILSON. Yes. 

Chairman NEY. Yes. 

Mr. RILEY. Yes, we are working on it. Mr. Maurstad could probably address that. 

Mr. MAURSTAD. The flood modernization mapping is a 5-year program that we are about at the halfway point. It is a billion dollar 

program over 5 years, with both additional funding coming from 

Congress and the full support of the Congress and the Administration and also funds continuing to be moved from the National Flood 

Insurance Fund along with the $200 million that is appropriated. 

So it is a multi-year program, we are working very closely with the 

States. I think you will hear testimony later about that working relationship, and we are committed to making sure we have modernized maps for that portion of our country that is at flood risk. 

Chairman NEY. Anything you want to add, Commissioner? 

Mr. METZGER. Thank you, Mr. Chairman. 

The only thing, to answer your question, the original question 

that you had was should the language be made simpler. And I 

think that it is common sense, the simpler the language can be 

made, the more the language can be put into layman’s terms, the 

better off. The less confusing it will be for policy owners because 

quite frankly sometimes I look at my policies and I wonder, what 

does that mean? And most people I think are under that. And 

again, being part of the legislature for 8 years, sometimes things 

are written—I have always said they are kind of written for full 

employment for attorneys, you know, to make sure that they have 

a job, to be able to interpret what was written in law or in policies 

or whatever. 

The other thing is, getting back to earlier, I think it is good that 

FEMA is moving the insurance agents to make sure that they disVerDate 0ct 09 2002 17:30 Sep 25, 2006 Jkt 029944 PO 00000 Frm 00019 Fmt 6633 Sfmt 6633 F:\DOCS\29944.TXT HFIN PsN: TERRIE
14

cuss the coverages, but I still feel it is important—you are leaving 

that up to the insurance agent to be able to determine what he 

wants to cover. I still think there should be something mandated 

in law that makes sure and requires them, each and every one, to 

consistently talk with their policy owners on the different types of 

coverages and to be able to explain that to them so that they have 

a full awareness of what is covered and what is not covered. 

Thank you. 

Chairman NEY. Thank you. One issue that has been raised is 

consumer education. Would you like to comment on that, as added 

to the legislation? 

Mr. MAURSTAD. Again, sir, we try to—we have got a multi-million dollar effort, Flood Smart, that is not only a public awareness 

campaign across the country through print media, TV, radio, the 

normal media channels. We have also developed a very comprehensive website, floodsmart.gov, where we encourage people to go and 

learn about their flood risk, learn about the National Flood Insurance Program. They can find agents that are near them that are 

a part of the program. 

So we are trying to do what we can with the resources that we 

have available to make sure that we get the message out about the 

flood insurance program, especially in those areas that are most 

flood prone. We are giving it our best shot. 

Chairman NEY. In trying to get the information out, I know you 

go to insurance commissioners, I would assume. Have you also 

gone to the EMA directors across the country, did they get an email on that, because they’re the ones usually that get calls in the 

counties. 

Mr. MAURSTAD. We work very closely with the State emergency 

managers across the country, local managers. I attend a number of 

their meetings trying to communicate with them. We host a flood 

conference every year. 

Chairman NEY. So you go through the State and then the State 

should go through the local? 

Mr. MAURSTAD. Yes, sir. 

Chairman NEY. Are there any further questions for the witnesses? 

[No response] 

Chairman NEY. I want to thank—Senator Wilson had to leave—

I want to thank all the witnesses and also local officials, Senator 

Wilson and Commissioner Metzger and other officials that are 

here, EMA directors that spent a lot of personal time trying to help 

people during the rounds of floods we had. 

With that, we will move on to Panel II, we will take a second to 

set up. 

[Pause] 

Chairman NEY. Thank you. We will move on to Panel II. First, 

we have Elaine Roskovich, who lives in Lansing, Ohio, Belmont 

County. Her home was damaged by a flood in September 2004. She 

is here today to tell us about her experience collecting insurance 

and her experience with the NFIP. 

Next, we have Chad Berginnis, who is the Chief, Mitigation 

Branch, in the Ohio Emergency Management Agency. He has coauthored a comprehensive revision of model State floodplain reguVerDate 0ct 09 2002 17:30 Sep 25, 2006 Jkt 029944 PO 00000 Frm 00020 Fmt 6633 Sfmt 6633 F:\DOCS\29944.TXT HFIN PsN: TERRIE
15

lations using his previous experience as a director of the Perry 

County Planning Commission. Mr. Berginnis is testifying today on 

behalf of the Association of State Floodplain Managers, an organization representing the flood hazard specialists of local, State and 

Federal Government, the research community and the insurance 

industry. 

Cindy Crecelius is a Program Manager in the State and National 

Flood Insurance Program Coordinator with the Division of Water 

in the Ohio Department of Natural Resources. She is a certified 

floodplain manager and is recognized by the National Association 

of State Floodplain Managers and is an Ohio Floodplain Management Association Board member. During her tenure as program 

manager of Ohio’s Floodplain Management Program, she has been 

recognized by the Association of State Floodplain Managers as a recipient of the Tom Lee Award of Excellence. 

Derrick Dozier is a Supervisor for Property and Casualty Insurance in the Office of Consumer Services, Ohio Department of Insurance. Please give our regards to Director Ann Womer, Benjamin. 

And Patty Levengood is no stranger to this county, she has been 

the Director of the Tuscarawas County Homeland Security and 

Emergency Management Agency for the past 10 years and has 

been a certified emergency manager since 1995. During the past 2 

years, her county has dealt with one tornado and four Presidential 

disaster floodings. 

Dick Quinlin is the Emergency Management Director with the 

Belmont County Disaster Services, where he has served since 1985. 

Prior to his appointment as the Coordinator, he served the agency 

for 10 years as a volunteer. And we know Dick quite well in Belmont County. I want to say to both directors, I have personally 

worked with them and been personal friends with Dick for years, 

worked with both directors and your staff, unbelievable job that 

you all did under a lot of stress. And I know there were nights 

where if you and your staff got 2 hours of sleep, you were very 

happy. But you really did a lot for the people and I wanted to mention that. 

Also, Karen Upson is the Director of the Ohio Valley Relief Center and Donation Management for Belmont County. Reverend 

Upson is a United Methodist Church pastor and a disaster coordinator for United Methodist Church, and has done so much also to 

help people in the communities. 

I would note Chuck Prost, Commissioner of Belmont County 

Commission, will submit testimony. And with that, we will give 

you basically 5 minutes or so to sum up your testimony and your 

statement will be placed in the record for the hearing. 

We will start with Elaine. 

STATEMENT OF ELAINE ROSKOVICH, FLOOD VICTIM 

Ms. ROSKOVICH. Yes, thank you for letting me be here today. I 

would like to share my story with you. But when I tell you what 

happened to me on September 17th, I am not speaking only for myself; I am speaking for hundreds of other people who went through 

the same thing. 

So I will start my story with September 17th. I got up in the 

morning and went to work at my shop like I normally did for alVerDate 0ct 09 2002 17:30 Sep 25, 2006 Jkt 029944 PO 00000 Frm 00021 Fmt 6633 Sfmt 6633 F:\DOCS\29944.TXT HFIN PsN: TERRIE
16

most 30 years. About 1:00 in the afternoon, I got a phone call from 

a lady that lives on Rain Barton Road and one of her relatives lived 

on the same street as my shop. She said I think you had better get 

home, there is something going on in Blaine, and they may close 

the road. And of course, everyone knows Perkins Field and Brookside gets flooded first. So if they blocked those two areas, I cannot 

get to Lansing. 

So okay, I finished my appointment and I did go home. When I 

left my shop and drove through Wheeling, you would not believe 

what I drove through. It looked like every corner was a lake and 

I figured when I got to the Marion Street exchange in Bridgeport, 

they would flag me onto 214, but luckily they let me go through. 

Well, there were cars backed up. When I got into Bridgeport, there 

was a landswell and mud slide at St. Anthony’s, and when I got 

further out, there was water coming down with gravel that you just 

would not believe. 

In Brookside, it was starting to come up. It was in Perkins Field, 

it was already starting to seep across 40. When I got up almost to 

stop 16 by Bridgeville, there by the Workmen’s Bureau of Compensation, there was a big hump of mud, debris, gravel, everything. 

So I was just trembling to get home. 

The road at U.S. 40 by Lansing Carryout was unstable from Hurricane Frances’ 4 inches of rain. It had already started to dig some 

of the side wall out. So when I did finally get up there, which took 

me almost 45 minutes to drive home, I drove across the road, it 

hadn’t caved in, part of it was—it was gone a little bit, like just 

by the guardrail, and there was a fire truck sitting there and the 

water was coming over the road towards the Lansing Carryout. 

Well, I live at least 2 blocks away from the creek, so when I finally got home and pulled in the driveway, my next door neighbor 

was leaving. She said that she was not staying to watch the water 

get in her house. Well, I would have sworn that water was never 

going to get in the house because water has always lain around 

there, but it has always gone down fast. 

So I went on in and I said well, I am home early and it is Friday, 

I am going to clean house. So I changed my clothes, put a pair of 

shorts on and a T-shirt, and came back out of the bedroom. When 

I looked out the living room window, there was my other neighbor, 

across from me, who is in her 80’s, being helped through waist-high 

water. So I opened the door and I yelled at her and she said water 

was coming in her house. At that time, my front steps floated 

away, so I tied them off. I went to the back deck and looked. I still 

had a foot on my deck, another foot to come up onto my deck and 

another step to come into the house. 

At that time I saw my next door neighbor behind me jump off 

his deck and he had told me—he was an engineer—that he was 

above the flood level. I just would have sworn I was not going to 

get any water. 

My phone rang and they said what is going on in Lansing and 

just then the water came through the door, hit my furnace with the 

cold water and water just started shooting out of the registers. I 

figured it was time to get out of there, so I just threw some stuff 

in a container, got my cat, and tip-toed out of there, because the 

water was all the way up to my chin. 

17

The water was not gushing, it was not swirling, it wasn’t doing 

anything; it was a very calm water. It just came up within 15 minutes. I mean I did not know that the road had caved in and 

dammed it up and back-flushed this water. So the water was up 

in Lansing for probably 12 to 14 hours. I did not sleep that night. 

I went up to the Methodist Church in Lansing but I walked Green 

Bank that whole night, walked where the edge of the line was. 

It was sometime in the morning, I do not know, it was dark out, 

the boat came in, I guess looking for survivors, and I was standing 

there like a crazy woman screaming get away from my house because the boat has one speed—fast, and it was going around and 

around and around my house and circling the other ones. I could 

see the waves slapping up against my house. I presume that is why 

all my furniture was turned upside down, and the water had gotten 

so high in the house, because it covered everything. 

And I do not think we would have had any flood if it had not 

been for Route 40 caving in, because we go downhill, when you get 

past that little turn, that goes downhill. We are much higher, but 

we got it when the road caved in, it dammed up. 

I was raised in this area, I have never seen Lansing flooded like 

that before and there was a gentleman that night who was across 

from the church who said his people built that house 83 years ago 

and that was the first time any water got in the basement. But of 

course, that probably leaves what, 14 to 15 years of a 100-year 

flood; so you know, you don’t know what happened before that 83 

years. 

When I purchased my land in Lansing, I purchased it after—

which I found out now, I did not know before that it was in a floodplain. Nobody ever told me it was in a floodplain. And I just assumed it was not because I grew up there and I never—you know, 

that was an old ball field that they had platted out, you know, in 

half acre lots. So when I purchased the land, I was told I was not 

in the floodplain. The mortgage company went through it, they 

were supposed to do—they hire these title companies to do all the 

survey. What happened to the title company, why did they not 

know this was a floodplain? This is what they get paid for. When 

I was on the island, I had to have flood insurance because I was 

in the floodplain, so I was not unfamiliar with flood insurance. 

They told me all I needed was homeowner’s. But why would a bank 

give you all that money and never do a complete search on your 

property. I owe $56,000 on my house, I had purchased it—I had 

bought the land at the end of 1988, around the end of the summer, 

and had the house put on just around Christmas time, December 

of 1988, it wasn’t completely finished until the beginning of 1989, 

which was a year and a half, almost 2 years, after it was deemed 

a floodplain. 

And I am mad, I am mad that my mortgage company did not tell 

me I needed it. I had the house refinanced in 1999. My husband 

was diagnosed with cancer at that time, he passed away 3 years 

ago, and I had it refinanced to make it a little bit easier for me. 

And that was Chase Manhattan Mortgage, which is part of J.P. 

Morgan Trust, which is the largest bank in the world. They did not 

tell me. Do the title companies that these mortgage companies are 

18

hiring not do their job? Whose fault is this that I would not have 

flood insurance. 

I am not blaming the county, I am blaming my mortgage company and the title company. But I now have flood insurance. I have 

flood insurance that FEMA gave me on a home that has been torn 

down. I have it until 2007. My house was condemned by Belmont 

County when they looked at it. FEMA measured the water inside, 

and said 30 inches to 3 feet from where the water line that they 

measured down. It was full of mold and they said, you know, it was 

unlivable and then Belmont County came down and tore down my 

house which was put in there at the end of 1988. 

And I am mad, I am mad because someone did not tell me that 

I needed flood insurance and I do not know who to blame. I hope 

that FEMA can explain to some of these mortgage companies the 

people that need flood insurance. 

I understand that when you have flood insurance, you are not 

going to get back everything that is owed to you, everything you 

lost. I mean, I lost everything, furniture, clothes, appliances and I 

collected diamond rings from the time I opened my business, it was 

just one of the things I did, it was like diamonds are 25 percent 

of me, if you ever need them, you have got them. And I lost between $60- and $100,000 worth. I mean I lost everything. To make a long story short, I went from living in a $100,000 home, with $50,000 worth of contents, personal property, and an 

Olympic sized pool in the backyard to being a bag lady in 15 minutes because I did not have flood insurance and no one had told 

me. Somehow or other, they should make these mortgage companies give you a flood determination when you buy property because 

I did not do any search on it. I could have probably done a better 

title search than they did and I paid them all those closing costs. 

So, as I said, I am glad that I came here and you let me voice 

my opinion on everything and I do not know why I have flood insurance now, but I do until 2007 on an empty piece of ground, 

which I could are less whether it floods or not now. 

I hope I said a little bit for other people too, to see if they can 

change around the insurance, and the title companies. 

Thank you very much. 

[The prepared statement of Ms. Roskovich can be found on page 

89 of the appendix.] 

Chairman NEY. Thank you. We will have some questions but we 

will just go straight down the line and then I have some questions 

I want to ask you. Thank you for your time. 

Chad. 

STATEMENT OF CHAD BERGINNIS, MITIGATION BRANCH 

CHIEF, OHIO EMERGENCY MANAGEMENT AGENCY AND IMMEDIATE PAST CHAIR, NATIONAL MITIGATION POLICY LIAISON, ASFPM 

Mr. BERGINNIS. Good morning, Chairman Ney. Thank you for allowing me, on behalf of the Association of State Floodplain Managers and the Ohio Chapter, the Ohio Floodplain Management Association, to testify before you today. 

Indeed, the NFIP is approaching 4 years old and like any other 

program that is large and complex has been revised, updated, and 

19

managed to reflect current conditions. While not perfect, the NFIP 

has been in many respects one of the world’s best solutions in addressing flooding issues based on what other countries have or 

have not done compared to our own program in the United States. 

Still, today we are not focused on the world, but floodplain managers and citizens affected by flooding here in Ohio. The balance 

of my testimony will address the National Flood Insurance Program where challenges exist and where opportunities lie. Although 

I will be talking from an ASFPM perspective, all of what I say has 

applicability to Ohio. I am hoping that my experience as a local 

floodplain manager as well as working here in the State of Ohio 

will contribute to that. 

First, let us discuss how State and local governments operate 

under the NFIP. State floodplain management programs are 

unique. Some programs focus on technical assistance and building 

community capability while others focus more on mapping. The 

point is under the NFIP each State is given the flexibility to develop programs that best fit their State. However, it must be recognized that coordinating the NFIP is the beginning point for doing 

comprehensive flood management and not the end point. Even 

under the rules of the NFIP, States are encouraged to do other activities that result in more comprehensive floodplain management. 

The ASFPM has recently produced a document, Effective State 

Floodplain Plan Management Programs 2003, that identifies 10 

principles for effective State floodplain management. Based on that 

document, all States need to become more effective in their work. 

One recommendation the ASFPM makes in regard to State programs is that FEMA allow for delegation of all or portions of floodplain management related programs. For example, FEMA is currently looking how portions of the flood mapping programs can be 

delegated to qualified and willing States. 

At the local level is truly where the rubber meets the road. Although in an ideal world, floodplain management decisions would 

be based on good data, local regulations, and building standards, 

and with the full backing of the community, this is often not the 

case. Political pressures, the lack of data, resources, and sometimes 

the low priority of floodplain management in the broader context 

with everything the community has to do are the reality of local 

floodplain management. The NFIP, while it does not directly fund 

the position of a local floodplain manager, does provide incentives 

for communities to participate in the program, such as what Mr. 

Maurstad had talked about, the community rating system. The 

ASFPM supports continuing community incentives to support effective implementation of local floodplain management programs. 

In terms of problems, inconsistencies, and delays, again let me 

stress that one of the unique features of the NFIP is that there are 

many entities involved, so usually it is in a post-disaster situation 

that things become really hectic. However, I submit that here in 

Ohio, that situation has not been as problematic as it has been in 

some other States in recent years. Undoubtedly there are issues 

and instances and certainly as Ms. Roskovich had indicated, there 

are some disjointed issues with the NFIP. 

For example, Lawrence County, which was sanctioned by the 

NFIP in the 1990’s is now one of the best programs in the State. 

20

This is on the Ohio River. This is not to say again that there are 

not some individual problems. From the ASFPM standpoint, some 

improvements can still be made in the post-disaster environment. 

These include: better notification of recipients of disaster assistance 

that local permits are required before repair and reconstruction; 

improved sharing of disaster assessment and insurance claims information with local officials to help identify potentially substantially damaged structures; and fully utilizing ICC insurance coverage by promoting its use, streamlining the claims process and implementing provisions allowing the more expansive use of ICC has 

changed in the 2004 Reform Act. 

Mr. Chairman, your opening statement during a hearing in 2003 

on the NFIP mentioned issues in the Powhatan Point. To illustrate 

how the program can work, the Powhatan Point floodplain administrator, using the tools provided under the NFIP, was able to access 

ICC funds to pay $30,000 towards elevating a home, making it no 

longer vulnerable to flood damage from a 100 year flood. These programs can work; however, there are some tweaks that can be 

made. 

Another area where problems tend to creep up is when a flood 

disaster occurs in an area that has not experienced that event for 

a long period of time, from both a community compliance standpoint and from an insurance standpoint. The Title II provisions of 

the 2004 Reform Act should more clearly help policies be explained 

to policy holders and provide them with more detailed information 

on the claims and appeals process, which I personally remember 

helping folks in the Stowe, Ohio, area talk about because it was 

quite ambiguous in terms of how that process worked. 

From a funding standpoint, the ASFPM believes that the NFIP 

is currently affected by one primary thing, the lack of funds to implement the 2004 Reform Act programs. We have already lost one 

year in 2005, and in 2006, we were happy to learn that the House 

fully supported full finding of those programs; however, the Senate 

did not. We are hoping that during the conference committee, that 

the House members will win out. 

Floodplain maps are a foundational element of the NFIP. We 

simply have not invested funds to maintain the maps and complete 

the initial mapping effort that FEMA has done in the past. However, FEMA’s map modernization program has the ability to make 

real and significant improvements. The ASFPM has always been a 

supporter of map modernization and we played a crucial role in the 

developing of the flood map coalition that garnered widespread 

support for map modernization efforts. 

A couple of points to be made about map modernization. As previous panelists have indicated, map modernization must be about 

making quality flood maps that identify the proper extent of flooding in a community, ensures flood zones match topography and 

that flood studies are at a certain level of detail. 

The map coalition, communities and property owners throughout 

Ohio and the Nation are depending on the recognition by Congress 

that map modernization is a worthwhile endeavor and that funding 

can continue with this program. There has been some discussion in 

past hearings about the cost of map modernization and the ASFPM 

does believe, based on data, that it will exceed the $1 billion 

21

amount. Given the testimony that was provided, again we would 

submit that updating the flood maps is critical to the Nation’s interest and that the Congress would continue to be interested in 

funding that modernization. 

Is Ohio ready for the next flood? We are much better prepared 

than if the NFIP did not exist. In my professional experience in 

over 10 years with the NFIP, I can say that it has made significant 

improvements in the lives of Ohioans but there is still always a 

chance to improve. 

Thank you. 

[The prepared statement of Mr. Berginnis can be found on page 

44 of the appendix.] 

Chairman NEY. Thank you. 

STATEMENT OF CYNTHIA J. CRECELIUS, PROGRAM MANAGER, 

OHIO DEPARTMENT OF NATURAL RESOURCES 

Ms. CRECELIUS. Good morning, Chairman Ney. I am Cindy 

Crecelius and I am representing the Ohio Department of Natural 

Resources Division of Water, and we have been designated as the 

State Coordinating Agency for over 30 years. I would like to thank 

you for the opportunity to share the State coordinator’s perspective 

on how well the National Flood Insurance Program works in this 

State. 

In Ohio, the NFIP is an active partnership. The State and the 

communities have as much interest in reducing flood risk as the 

Federal Government. The State role is that of leadership for cooperative management of floodplains. We are building capability in 

all aspects of the NFIP and we complement the NFIP objectives by 

integrating floodplain management with State agency action, policy, and funding. 

The NFIP framework allows Ohio to develop a floodplain management program based upon our needs, strengths, and opportunities, and this is a huge benefit. 

The community role is tied to health, safety, and the economy of 

each community. Addressing flood problems is a local health and 

safety concern. The community has to commit to the need and the 

purpose of floodplain management in order to be successful in the 

NFIP. 

To support these roles, FEMA can build upon the Community Assistance Program (CAP). The CAP is an efficient cost-shared funding mechanism that has been building State capability for over 30 

years. FEMA should explore partnership models that use business 

plans and performance metrics to allow for delegation of NFIP and 

map modernization activities. 

The 2004 Reform Act is well-focused on changes to better link 

mitigation funds and NFIP compliance, improving insurance 

agents’ knowledge and creating easily understood consumer products. And your work in the committee is certainly to be complimented in having that good focus and targeting some of the 

major problem areas. 

Although training sessions have been well-attended in the State 

of Ohio, agents’ knowledge is not necessarily improving. We have 

already heard this morning that some States have strategies to improve agents’ knowledge, which includes requirements for conVerDate 0ct 09 2002 17:30 Sep 25, 2006 Jkt 029944 PO 00000 Frm 00027 Fmt 6633 Sfmt 6633 F:\DOCS\29944.TXT HFIN PsN: TERRIE
22

tinuing education and more flood insurance content in their licensing exam. We do need to improve agent knowledge concerning flood 

insurance products in the State of Ohio. 

The ICC or Increased Cost of Compliance is not well-utilized. 

Our floodplain managers need more education about how and why 

it should be used. FEMA has to continue implementing changes to 

current NFIP mitigation programs that will recognize the ICC as 

non-Federal funds, expedite processing of the ICC claims and support local NFIP compliance as an effective mitigation tool. 

The CAP funding was intended and has been used to build State 

coordinator capacity to help implement the NFIP in over 20,000 

communities. This is important because FEMA does not and never 

will have the resources and the funding to carry out all the program responsibilities nationwide. 

Ohio currently has 12 staff supporting NFIP map mod and State 

floodplain management. CAP funds four of those positions. The bottom line is that effective State coordination of the National Flood 

Insurance Program means that State contributions go well beyond 

the required 25 percent non-Federal match. 

Flood hazard maps are critical to safe construction and good development decisions. That is the bottom line for map modernization. The test of currency should be focused on whether the flood 

hazard identified is accurate and if it is the correct level of detail 

related to what is at risk. Another element of currency is the use 

of efficient technology such as Geographic Information System and 

digital data to support making good maps the best way. 

The importance of quality flood hazard information cannot just 

focus on the date of a map. An inaccurate map, regardless of the 

date, can mean: somebody at risk will not know it; someone who 

is not at risk might have to purchase flood insurance and meet 

flood protection requirements; or someone in an area not yet identified might experience significant property damage and even loss of 

life. 

The Ohio vision for map modernization is that all communities 

will have accurate, quality flood maps. The detail of study should 

be commensurate with the level of risk. Our State business plan 

contains minimum criteria for production of quality modernized 

maps. FEMA, State coordinators and the mapping partners need 

more dialogue about how and who will maintain those updated 

maps. 

Following disasters, NFIP compliance is smart recovery. Local 

floodplain managers need support from both the Federal and State 

level as they enforce NFIP regulations. FEMA policies should allow 

reimbursement for substantial damage inspections as an eligible 

public assistance activity. Disaster victims who have available 

funds, volunteer manpower, and materials are anxious to repair 

and return to a ‘‘normal’’ life. To make the NFIP a successful mitigation tool, the enforcement and permitting process has to be as 

quick and efficient as disaster assistance and insurance claims 

processing. 

In conclusion, Ohio is better prepared and more able to respond 

to flooding through participation in the NFIP. Further risk reduction is expected and can result from accurate, quality maps and improved NFIP compliance. The NFIP is a well-conceived mitigation 

23

strategy that provides for the collaborative management of the 

flood hazards in Ohio. 

Thank you. 

[The prepared statement of Ms. Crecelius can be found on page 

61 of the appendix.] 

Chairman NEY. Thank you very much. 

Mr. Dozier. 

STATEMENT OF DERRICK DOZIER, SUPERVISOR, PROPERTY 

AND CASUALTY UNIT, OFFICE OF CONSUMER SERVICES, 

OHIO DEPARTMENT OF INSURANCE 

Mr. DOZIER. Thank you, Chairman Ney and your committee 

members, for the opportunity to testify on the National Flood Insurance Program. I am Derrick Dozier, the Supervisor of the Property and Casualty Unit of the Office of Consumer Services at the 

Ohio Department of Insurance. 

I am here today representing Ann Womer Benjamin, Director of 

the Ohio Department of Insurance. I have been with the Department for more than 22 years and have held my current position for 

the past 10 years. While I am not involved with every phone call, 

I do review every written complaint sent to the Department of Insurance involving flood insurance. 

My Division, the Office of Consumer Services, is the consumer 

protection arm of the Department. We assist consumers with all 

types of insurance related complaints and answer a variety of questions. Annually, my division handles more than 90,000 consumer 

inquiries on all kinds of insurance issues. Some of these inquiries 

rise to the level of written complaints against an insurance company or agent and in 2004, we handled about 8000 written complaints from consumers; as a result, helped consumers recover over 

$6 million. 

In my invitation to come to testify before the committee today, 

I was asked to address a number of issues regarding the NFIP. 

The first issue I was asked to address was to comment on the 

responsiveness of the NFIP and private insurance companies participating in the NFIP to paying claims for recent floods and to describe the types of complaints we hear at the Department about 

payment of flood claims. 

The information the Department receives from the responsiveness of the NFIP and the NFIP insurers to flood claims generally 

comes in the form of calls and e-mails we get from consumers. 

The Department has a system of tracking consumer complaints. 

One category we track is flood claims relative to homeowners’ insurance. Since 2000, the Department has tracked 24 complaints relating to flood insurance. The majority of these complaints relate 

to delays in processing claims. 

Many of the calls the Department receives are not complaints, 

but inquiries where the consumer is seeking information. We regularly get calls from consumers about flood insurance, and the inquiries we get far outnumber the complaints. Some of the inquiries 

do involve flood claims. We work with the consumer even though 

no complaint is filed. 

When a consumer contacts us about flood insurance and the 

NFIP needs to be involved, we will call the NFIP directly for the 

24

consumer. In the case of a flood insurance claim, we contact an 

NFIP claims manager directly. In our experience, the NFIP claims 

managers get back to the Department promptly. We do not track 

all our referrals to the NFIP. 

The second issue you asked me to address was the steps the Department has taken to educate consumers and agents about flood 

insurance and what else can be done. 

As you know, neither the State of Ohio, nor the Department, regulates flood insurance products or rates. However, we do work to 

educate consumers and agents on the NFIP. We do this by publishing and distributing information about flood insurance, by answering consumer questions, by working with the NFIP on consumer issues, by speaking to consumer groups, and by sending representatives into the communities affected by floods. For example, 

during flood events, the Department sends personnel from my staff 

on site to Disaster Assistance Centers to help consumers with their 

questions, claims and complaints. 

Another way the Department educates consumers is through our 

shoppers’ guide. I brought some of those here today. This is our 

homeowners’ shoppers’ guide, for your review. We publish and distribute the consumer guide on homeowners insurance that contains 

a section on flood insurance. This guide stresses that homeowners’ 

insurance does not provide coverage for floods, and that consumers 

must contact their insurance agents or companies to find out 

whether they need flood insurance and how to buy it. The consumer guide also provides information about the NFIP, including 

NFIP’s phone number. This consumer guide is available in print 

form and also on the Department’s website, which is 

www.ohioinsurance.gov. 

The Department also has a dedicated staff of consumer analysts 

who can answer questions about flood insurance. Consumers can 

call the Department’s toll-free consumer hotline, 1–800–686–1526, 

and they can talk to a consumer analyst with experience in flood 

insurance. The analyst will work with the consumer until the consumer’s questions are answered. 

The Department also has put together a ‘‘Consumer Tips’’ series 

of press releases, one of which deals with flood insurance. News organizations around the State can access the Consumer Tips for use 

in newspaper, radio, and television spots. 

In terms of doing more, the Department is constantly working to 

improve the information it provides to Ohio consumers, and flood 

insurance is one of the topics on which we have focused. We believe 

consumers should know that homeowner’s insurance does not cover 

flood damage and that flood insurance must be purchased separately. To make sure more consumers know this, there is a cooperative effort between FEMA and the Department. The information 

the Department circulates is clear on this subject, but more can be 

done to get the information to the consumer. Our Department welcomes the opportunity to work to improve the distribution of this 

information. 

The third issue I was asked to address today deals with the 

training and licensure requirements that apply to insurance agents 

selling flood insurance in Ohio. 

25

There is no special flood insurance license in Ohio. All property 

and casualty insurance agents licensed by the State of Ohio are authorized to write flood insurance with the NFIP. This means that 

the licensure requirements that apply to insurance agents generally are the licensure requirements that apply to insurance 

agents selling flood insurance. 

An applicant for an agent’s license must complete 40 hours of 

pre-licensing education that includes instruction on flood insurance, and is required to pass an exam, which includes questions on 

flood insurance. 

After obtaining a license, an agent must complete 20 hours of 

continuing education every 2 years. The Department has approved 

4 hours of CE if the Ohio agent completes FEMA’s flood insurance 

seminar, which was discussed earlier. The Department has approved other flood insurance courses for CE credit as well. Other 

agent education courses are also available through FEMA. 

Since 2000, the Department has received very few complaints 

against insurance agents involving flood insurance. We attribute 

this to the fact that a basic understanding of flood insurance is a 

requirement to obtaining an insurance agent’s license in Ohio. 

In closing, I want to say that we agree that it is very important 

that consumers and agents are knowledgeable about flood insurance. The Department is committed to educating consumers on a 

variety of insurance issues and is always seeking a better way to 

communicate with consumers. We welcome a discussion on how to 

better educate consumers about flood insurance. 

Once again, thank you on behalf of Ann Womer Benjamin, our 

Director, and I would like to thank Chairman Ney and the committee members for inviting me today to testify. 

[The prepared statement of Mr. Dozier can be found on page 71 

of the appendix.] 

Chairman NEY. Thank you. Patty Levengood. 

STATEMENT OF PATTY LEVENGOOD, DIRECTOR, TUSCARAWAS 

COUNTY HOMELAND SECURITY AND EMERGENCY MANAGEMENT AGENCY 

Ms. LEVENGOOD Thank you. I would like to thank Congressman 

Ney and the committee for inviting me to testify this morning. 

My experience in the National Flood Insurance Program stems 

from the aftermath of recent flooding incidents in Tuscarawas 

County. Most problems with insurance issues are unveiled days 

after the incident, and for our agency, coincide with the FEMA, 

State and local damage assessment that we are required to do. The 

damage assessment process is a verification of financial and situational hardships faced by the community in the progression toward 

a Presidential declaration. While interviewing affected residents, a 

common issue has arisen about the complexity and confusion of different insurances that impact claims. Lack of knowledge on the 

regular homeowners insurance, the NFIP, sewer backup, and earth 

movement riders often surface as residents feel they are at odds 

with their insurance company. 

Our course of action during these episodes is to give the resident 

the Ohio Department of Insurance hotline phone number established during these times. If a house experiences flooding at the 

26

same time the earth saturated grounds break a foundation and the 

sewage system can no longer hold the pressure back, thus completing the task of filling the entire basement, what insurance is 

to be used or are residents forced to carry all or none? County residents have stated during the damage assessment that claims have 

been denied because they carried sewer backup but not NFIP or 

vice versa, when it was clearly a combination of both. 

I understand their complaints, but have no other course of action 

besides the previous mentioned hotline. After many incidents of 

similar occurrences following the many recent floods, a lack of communication exists that delineates the purpose and coverage of the 

different insurances available. 

And again, I would like to thank the committee for allowing me 

to testify today. Thank you. 

[The prepared statement of Ms. Levengood can be found on page 

75 of the appendix.] 

Chairman NEY. Thank you, Patty. 

Dick Quinlin. 

STATEMENT OF RICHARD QUINLIN, COORDINATOR, BELMONT 

COUNTY, OHIO EMERGENCY MANAGEMENT AGENCY 

Mr. QUINLIN. Thank you, Bob, for giving me the opportunity to 

testify here today. Actually though, my administrative assistant 

Becky should be the one sitting up here. She is the one that deals 

with all the complaints and prepared this information for me. 

But just briefly I have some comments on what she experienced 

when people come into our office. 

In September 2004 and January 2005, Belmont County residents 

suffered damage to their property due to flooding and mudslides. 

Regarding folks who carried flood insurance, some of the difficult 

things they had to deal with are as follows: 

At the time of loss, most homeowners who had flood insurance 

policies had them because their mortgagee forced them to carry the 

coverage in order to finance their homes. The National Flood Insurance Program needs to market their product more. In marketing 

their product, emphasis needs to be put on the fact that flood insurance may also cover for loss against mudflow/mudslides. We had 

several homes slide off their foundations. These homes sit far above 

floodplains and their residents, therefore, did not dream about buying flood protection. Tenants are not aware that they too can purchase flood insurance on their personal property. However, in order 

for contents to be insured on a homeowner or tenant policy, the 

property must be situated on the first floor or above. Also, if an insured is away from their residence due to work, vacation, etc., they 

are unable, therefore, to move their contents from the basement in 

the event of a flash flood. Emphasis needs put on this. In addition 

to verbally, this may be indicated by a notice or sticker placed on 

the declarations page. Becky has also seen coverage provided in the 

amount the bank demands to cover their loan; therefore, contents 

coverage is not offered to the homeowner. 

When suggesting flood insurance protection, people have told us 

it is not affordable. It might be a good idea to offer better 

deductibles or higher deductibles to help get the premiums down, 

but that would only, in my opinion, help the people that have the 

27

funding to buy the insurance. You get into our area where you 

have got a lot of limited income, maybe single family breadwinners, 

you know, workers and stuff, they just cannot afford the additional 

cost, whatever it be and there needs to be some kind of a subsidy 

put in to help those too if the program is going to work. 

Another area we got into in claims service, we heard at the time 

of loss, several homes are damaged or destroyed. In some instances, it has taken 30, 60, or even 90 days before an insured is 

contacted by an independent adjuster assigned by the NFIP. At the 

time of an NFIP sale, the potential insured should be made aware 

that there are numerous companies now selling flood insurance. 

These carriers may have a larger selection or availability of claim 

adjusters that can contact the insureds within 24 to 48 hours after 

the notice of loss. 

Increased cost of compliance procedures are difficult to follow. It 

seems a claimant is forced to foot the cost of elevating their home 

before the policy will pay or reimburse the policy holder. We have 

not had much dealings with this, but there seems to be problems 

with ICC adjusting. The insured’s dwelling flood claim is adjusted 

before they are contacted by an ICC adjuster. I think it should be 

the other way around if not taken care of by the same adjuster. 

We did deal a lot with the mudslides and the issues there. I was 

not even aware until Becky researched this—and to give a little 

background on Becky’s experience, she had been involved in the insurance industry for several years before I had and that was one 

of the things we wanted to get her on board for. 

The question ‘‘Is Ohio ready?’’ I do not know. I can honestly say 

not only through some of the dealings we have had with people trying to get claims, with the exception of the loss of life in 1998 and 

again in 1998 and we lost a life this time too, take the loss of life 

factor out of this stress, these last years in dealing with a lot of 

the regulations and stuff has probably been the toughest of my career to deal with. I think probably a lot of the other EMA directors 

too. 

I want to thank you for letting me come up and testify and hopefully these comments will help. 

[The prepared statement of Mr. Quinlin can be found on page 88 

of the appendix.] 

Chairman NEY. Thank you, Dick. 

Rev. Upson. 

STATEMENT OF REVEREND KAREN UPSON, DIRECTOR, OHIO 

VALLEY RELIEF CENTER AND DONATION MANAGEMENT, 

BELMONT COUNTY, OHIO 

Rev. UPSON. I also want to echo that I speak on behalf of others 

and their concerns. 

I also am using my experiences from tornadoes, winter storms, 

blizzards, and the 1998 disasters that hit our community, along 

with my education as a fireman, a paramedic, and a minister. I 

have worked with Belmont County EMA since 1998 to construct a 

disaster plan for relief and donations to service each community. 

The program was put into action on September 9th, after the first 

of three floods hit our area. Since September of 2004, we at the 

Ohio Valley Relief Center have been assisting almost 1,500 families 

28

and that is probably only approximately part of the 2,500 we feel 

may have been affected by flood from the 23 communities in Belmont County. 

Persons from Jefferson, Noble, Harrison, and Munroe Counties 

have also sought our assistance, along with people from West Virginia. Every week, someone new comes in to seek assistance who 

may have fallen through the cracks or just needs someone to help 

them. 

We have seen and heard many issues and many concerns in relation to the Federal assistance programs and ‘‘Is Ohio ready’’. 

I would like at this point to offer some input about the concerns 

of delay of services, but at this time I will limit my comments to 

the subject before us. And this is my testimony based on what others have listed as issues and concerns about the flood insurance 

and their situation. 

Some of the statements we have heard throughout our area of 

volunteering and working with those in need: 

Some still are paying off loans from the floods of 1998 and some 

from 1990. 

After the 3 years of paid flood insurance is done: 

Some say they did not have clear notification that their 3 years 

is up that FEMA paid for their flood insurance, and that it is done. 

And at that time, it is their responsibility to pick up and continue 

coverage. 

Some say that their loans were increased after the 3 years and 

the cost is now too high for them to be able to afford flood insurance. 

Some say that each time the loan is sold to another agency, another bank, another mortgage company, their loan seems to go 

higher and higher and they have no control over the increases in 

their payments. 

Some have told us that when their loans or mortgages have been 

sold or bought by other funding sources, their flood insurance coverage was not included and it was dropped without their knowledge. 

Some say the bank and funding agencies told them that they did 

not need coverage and were not required to have it, or that they 

were not in a floodplain, even though they live next to a road. 

Eight families on one street were told they did not need it and they 

were right next to a creek. 

The next issue I looked up is the cost: 

Some say that it is $3,000 or more a year on top of the cost of 

their loans for their insurance and some have said it has been as 

high as $1,000 a month for them to continue their flood insurance. 

Some say their award from FEMA was deducted as a part of the 

coverage for their insurance based on lack of knowledge or poor 

education of getting the information to them. 

Coverage of flood insurance: 

Some say that the fast rising floodwater damages are not covered, only slow rising waters. 

Some say their contents are not covered, only structure is covered by their flood insurance. 

29

Some have damage from the disaster caused by land slippage 

and it is not covered by the flood insurance because it was not a 

floodwater. 

Some have had damage to their home with family rooms or what 

we consider, as has been said before, what is typically called a 

basement or living area. When we live on hillsides, it is a big controversy as to what level is living area and what is basement. 

Some have damages from sewers and runoff waters and that is 

not covered. 

Some have damage of flooding with the orange runoff water from 

mine slippages and the insurance will not cover that. And then we 

have issues with the Division of Mines verifying that it is a mine 

damage and who is going to cover that or not. That is verified by 

looking in our streams at this time and seeing the orange water. 

Another issue is that now with more flooding and some who are 

not free from their past loans, they cannot even apply for more 

loans and some say they cannot afford the additional insurance 

that would go along with that loan had they been able to get it. 

Some had their flood insurance dropped. Some say their insurance has been dropped when they filed a claim, their company 

came back and told them that they had been dropped as a carrier 

for them. Some say they were even dropped without their knowledge. 

One issue I did not put on my statement I would also like to readdress is the processing time for claim insurance processing. We 

still—to this date I know one person in particular, but there are 

others out there, it has been 11 months since the flood and they 

have not received any money from their insurance, they have a private insurance carrier. 

I also looked up suggestions that came from our staff and volunteers: 

One is keep the information details simple and clear for understanding, even to the point of one or two pages, 12 font, and on a 

fourth grade reading level for the people to fully understand the information. 

Bank loans and companies, mortgage companies could not increase the cost of insurance once that 3-year period is up for future 

first or second years. Some of the families are still getting back on 

their feet and if they do increase it, then they get a very low percentage cost of living or something of that percentage. Or the increase of flood insurance is based maybe on their income or their 

property value and not based on a company value of how much the 

insurance should cost. 

The second—third thing I want to continue to share is also that 

the bank loan or mortgage companies contact the floodplain inspectors of the county where that residence sits and they have a written verification that flood insurance is needed. All the local officials 

such as floodplain inspectors have direct input to the insurance 

program and administration of those programs and understand 

clearly what is floodplain and what is not. 

When loans are being sold to another mortgage company, the clients need to be notified very clearly as to the selling of their loan 

and to make the increased cost and services offered rather than 

being dropped. 

30

Insurance companies cannot drop their clients based on a nationally declared disaster. 

And that a cap should be set for the cost of the insurance policies. Just as there is a cap on what insurance will pay for damages, 

there should be a cap on what the client can afford to pay. 

And then the last thing is that there should be a set deadline for 

those who are clients to receive renotification from the insurance 

companies, a call back, within 24 hours as has been stated. Or that 

a deadline date from a disaster, that they would receive those 

funds by that deadline date and not wait until a year later to receive them. 

I also thank you for your time, your consideration to my sharing 

of this information. 

[The prepared statement of Rev. Upson can be found on page 91 

of the appendix.] 

Chairman NEY. I want to thank all the witnesses for their testimony. 

I wanted to just ask a few questions if I could, of Ms. Roskovich. 

What year did you buy the house? 

Ms. ROSKOVICH. In 1989. 

Chairman NEY. In 1989. 

Ms. ROSKOVICH. We purchased the land in the summer, late 

summer of 1989. He was going to put condominiums in there and 

I guess there were objections and he just platted it out into half 

acre lots. 

Chairman NEY. And now you say you have been notified by 

FEMA that you have insurance? 

Ms. ROSKOVICH. Oh, yes. 

Chairman NEY. But the house is gone, correct? 

Ms. ROSKOVICH. It is gone, but they sent me a letter. I have it 

somewhere because I was staying with a friend of mine until the 

end of March and it’s put away in one of the file boxes, but I got 

all these sheets, all kinds of papers. I called them and I asked 

them, I said why do I have flood insurance now, the house is gone. 

And they said well, we have to do this. And they said they took 

$600 out of the money that would have been allocated to me to buy 

me flood insurance and I have it now until November 19, 2007, on 

an empty piece of ground. 

Chairman NEY. Onto the issue of when you purchased the home 

and the title search was done. 

Ms. ROSKOVICH. Yes. 

Chairman NEY. You say that Chase is the one that—or that did 

the refinancing. 

Ms. ROSKOVICH. No, Chase is the one who refinanced it in 1999. 

Chairman NEY. In 1999. 

Ms. ROSKOVICH. Bank of America was the first mortgage and 

they did all whatever they had to do. 

Chairman NEY. Well, yes, when you refinance, you get a title 

search automatically. Do you have a copy of that title search? Have 

you looked—been able to look at that or what it said? 

Ms. ROSKOVICH. I lost all my papers, but I went to the courthouse and they made up what I had in the mortgage papers. There 

was a little one there, I did not really know what I was looking for. 

There was an extra little thin sheet of paper that gave a short defiVerDate 0ct 09 2002 17:30 Sep 25, 2006 Jkt 029944 PO 00000 Frm 00036 Fmt 6633 Sfmt 6633 F:\DOCS\29944.TXT HFIN PsN: TERRIE
31

nition, like frame house, you know, had different indexes all the 

way down, but I did not see a flood determination paper on it. 

Chairman NEY. So the paperwork states nothing either way? 

Ms. ROSKOVICH. It explains where the pins are in the yard and 

everything else. 

Chairman NEY. But it does not say anything about flood. 

Ms. ROSKOVICH. Not one word. 

Mr. RILEY. Mr. Chairman, if I may, I know that as a standard 

part of purchasing a home and getting a mortgage, you have to pay 

a flood search fee. Did you pay that flood search fee? 

Ms. ROSKOVICH. Well, I do not know, closing costs were like $4,000, so I am sure whatever they did, they were supposed to look 

through it. I have no idea what they have to do, all I know is they 

charge a lot. 

Mr. RILEY. Perhaps somebody else on the panel can respond to 

that, but I know that as a part of getting a mortgage, you pay a 

flood search fee, which is a nominal amount, a third party fee, that 

is passed on to you, the consumer. 

Ms. ROSKOVICH. I paid for the appraisal, I mean that was a separate fee I paid. If there was anything that I would have needed, 

if they would have said stand on your head and kick a ball around 

with your feet, I would have done that, because it is the mortgage 

company, you do what they tell you to do, whatever the cost would 

be. You know, you do not argue with them, they say you need an 

appraisal, okay, $300, pay for the appraisal. It is their place to tell 

you. I am not experienced in their field and so they are the ones—

but you pay all this money and closing costs, should they not know 

about that? 

Chairman NEY. We can work with you afterwards to look at 

some of the paperwork to see what was done at that time or not, 

what paperwork we can recover off of that, I mean if you would 

like that. I would be very curious to see, as Mr. Riley mentioned, 

I would be curious to see what was there at the time of the refinancing or the original purchase and what they did in that title 

search. 

Ms. ROSKOVICH. Well, I will get all the papers together, I have 

an appointment with Mr. Thomas, one of the Commissioners, he 

deals in real estate and I would like to have him look at that. 

Chairman NEY. Yes, and we can follow up with the Commissioner. 

Ms. ROSKOVICH. I would like that. 

Chairman NEY. Absolutely. 

Ms. ROSKOVICH. I have all the papers that I got from the courthouse. The original ones that we had, my file cabinets were turned 

upside down, everything was under mud. I mean I had no titles to 

cars, mortgage papers, income tax returns, nothing. 

Chairman NEY. We will follow up as you wish with Commissioner Thomas afterwards. 

Ms. ROSKOVICH. Yes, that is what I am going to do, to see what 

he can find out. 

Chairman NEY. He is also an attorney. 

Ms. ROSKOVICH. Yes. 

Chairman NEY. Do you have any comment, anybody? 

Mr. WATKINS. I wanted to say one thing about her situation. 

32

Chairman NEY. Just for the record, please identify yourself. 

Mr. WATKINS. I am sorry. My name is Ed Watkins, I am with 

the Ohio Valley Relief Center in Belmont County. 

In Lansing, they were declared, that area that they live in that 

is under question, was declared in the floodplain in 1987, and she 

bought her home in 1988. 

Chairman NEY. 1989. 

Mr. WATKINS. 1989. I just wanted to clarify that for the record. 

Chairman NEY. Thank you. 

Mr. BERGINNIS. Chairman Ney, maybe I am relating a more personal experience having just refinanced my house last year, in 

terms of the flood insurance; you know, at the closing, the closing 

agent is supposed to go through everything with you, explain line 

by line and also even show you the flood zone determination and 

spell that out. Now saying that, that was my experience there. I 

have in my professional experience before even talked to a banker 

who said it has not flooded here in 70 years, we are not going to 

make people go through that stuff. 

Chairman NEY. Can I ask, if there a checkoff box of flood insurance or no flood insurance, whether you decline it or not? Is there 

a checkoff box? I don’t recall that. What I was wondering, you 

know how when you refinance or you get a bank loan, you check 

whether you want credit life, you say yes or no, you have to initial 

it. I just wonder on policies—because I have not dealt with—where 

I live there was no—St. Clairsville, Noah’s Ark would be there if 

it was flooded, but I do not ever recall a checkoff box for a yes or 

a no. 

Ms. CRECELIUS. Chairman Ney, if I may. What probably went on 

is in the first financing back in the 1980’s, there was not the 

Standard Hazard Determination Form and there was no requirement for the flood certification that Representative Riley referred 

to. However, I do not believe you can deny, you know, whether or 

not you want flood insurance because it is a mandatory purchase 

that kicks in and that is why they are using the Standard Hazard 

Determination Form. So that should be part of the closing package 

and that either does or does not justify the amount of fee that you 

pay, but that should be part of the closing from 1999 because it has 

been required since 1987. 

Chairman NEY. Okay. 

Ms. ROSKOVICH. I was told that it should be included in it, but 

I do not have the original papers, you know. And everything that 

they have at the courthouse, they have given me. I talked to several mortgage companies also in the area and one of them told me 

that they do 95 percent of their business with Chase Manhattan 

Mortgage and I said could you tell me from Blaine to Bridgeport, 

is it considered a flood area, and she said every loan that Chase 

Manhattan Mortgage does in that area is considered a floodplain. 

She said anything that is down by 40 is considered a floodplain and 

you have to get flood insurance before they will give you a mortgage. 

So what happened? Did I fall through the cracks or what? You 

know, I want to know what happened. 

Chairman NEY. Well, like I say, after you talk to Mark, if you 

want, we would like to communicate with you further, for the benVerDate 0ct 09 2002 17:30 Sep 25, 2006 Jkt 029944 PO 00000 Frm 00038 Fmt 6633 Sfmt 6633 F:\DOCS\29944.TXT HFIN PsN: TERRIE
33

efit of the committee in Washington, to be able to get to know what 

happened, because there will be different policies I am sure in different States also—I mean different practices. 

I also wanted to mention, Mr. Dozier, in the legislation that we 

passed is consumer protection. And if you would like to get the details, we would like to follow up with you on the details of what 

is in there nationally and what consumer protection and the information. What I am hearing a lot today is about information, clarification, communication, education. We would be glad to follow up, 

if you would like, we can get you the details of what was in the 

law. 

Mr. DOZIER. Thank you, I look forward to receiving that. 

Chairman NEY. I wanted to ask a question, just to jump around 

a little bit, an issue, Rev. Upson, that you raised. You had mentioned you dealt with someone whose policy was, you say, the loan 

was refinanced and that it did not move—the insurance did not 

move along with them? 

Rev. UPSON. Yes, we have had clients that have come in and I 

wish I would have documented the complaints through this time 

period, and this came right after the first of our floods, they came 

right up and said that when their home was refinanced or remortgaged, their insurance did not carry with them, the flood insurance. 

And they had no idea that it was not part of that policy. 

Chairman NEY. Because that raises an issue that we could look 

at about what requirements go along with the policy. I think we 

could definitely take a look at that. 

The other question, the processing time. I think both of the directors, EMA and you, mentioned the processing time. And this is the 

processing time, is it due to the National Flood Insurance Program, 

was it due to private insurance companies? Anybody want to elaborate on that 11-month processing time? 

Rev. UPSON. The one client I know in particular that I still know 

as of today still has not received any, his was a private insurance 

that he had. And he lives in the community of Quincy, and he has 

not been able to start doing any repairs or any work on his home 

due to the fact that he has not received any insurance. I refer back 

to the EMA’s office, speaking with Becky Horn, who I thank him 

too, because she has worked with insurance and she has been 

working with him in the ICC trying to get this process in a manner, but as of today, Becky, I still do not think he has received any 

money yet. 

Ms. HORN. No. 

Chairman NEY. Do you have any comments, Patty or Dick, on 

that? 

Mr. QUINLIN. Becky, what did you see was the best response, private or the NFIP? 

Ms. HORN. I was referring to— 

Chairman NEY. Just go ahead and give your name for the record, 

for the stenographer. 

Ms. HORN. My name is Becky Horn, I’m with Belmont County, 

I’m the administrative assistant to Dick Quinlin. And what I want 

to say is that I think we are talking about two different things. 

Karen is talking about the payment from the insurance company, 

NFIP, and what we experienced was we have got the Write Your 

34

Own companies that have a huge bank of adjusters. A volunteer of 

ours, of EMA, within 48 hours, he had a check for his policy value, 

$58,000 from Allstate. I think that is the company that writes their 

own flood policies. However, on National Flood Insurance, I believe 

they assign independent adjusters and I talked to a couple of my 

independent agent friends in Shady Side and Martin’s Ferry and 

they were bringing adjusters from Tennessee—I do not have my 

notes in order here. We were not allowed to use Gideon Irvin, a 

local independent adjuster over in Wheeling, and therefore, turnaround time just—I lost my house, I have not heard from my adjuster, it has been 30, 45, 60, even 90 days before I heard from an 

NFIP independent adjuster or assigned adjuster. So the lack of adjusters is what the problem is with NFIP. 

Chairman NEY. So you think the lack of adjusters has caused a 

lot of the delay time? 

Ms. HORN. Yes, just because when you have this massive flooding, it is not like say you have a fire in a house here or there, the 

adjuster is right there even while the house is burning. Here you 

have hundreds of homes and it is overwhelming and we just need 

to get some qualified persons that are able to adjust NFIP claims 

and be on the spot within, you know, hours, if not a couple days. 

Chairman NEY. Another question that I had, a question for Ms. 

Crecelius, is there a national number available or does ODNR have 

a number when it deals with flood insurance, or do you have anything to do with that? 

Ms. CRECELIUS. Yes, there are both national numbers and the 

Department of Natural Resources has technical assistance available. We do not have an 800 number at the State level, which 

FEMA does, but we do provide through a general program number, 

any type of assistance that we can. 

Chairman NEY. Okay. Somebody else have a comment? 

Mr. QUINLIN. Yes. The one thing too we mentioned, Congressman, about the coverage available for mudslides and stuff on the 

hillsides that happened, I think that there needs to be—if there is 

in fact coverage available, customers could be made aware of that 

and local officials because historically once you move the people up 

out of the floodplains and put them up on hillsides, I see that is 

going to be the next major thing in a few years we are going to 

be dealing with, especially in our terrain, you know, loss due to hill 

slides, mudslides. And it slows down whether it is a subsidence 

issue or whether—there is just a lot of confusion, which I am probably as confused as anybody is when we get calls at the office, to 

tell them where to go to. 

Chairman NEY. That raises a question that I would like to ask 

Mr. Dozier that maybe he will not be able to answer now, but possibly could look into. 

The witnesses basically have mentioned that you could have a 

sewage backup problem, you could have a hillside or you could 

have direct flood, slow-moving or fast-moving. Has anybody looked 

at basically one policy that says if the following happens, you are 

covered, so that you do not have the dilemma of was it the sewage 

that came in and caused the damage to the foundation or was it 

slow-moving or fast-moving water. I wonder if anybody has looked 

at that and if there is a price difference on it. 

35

Mr. DOZIER. Well, our shoppers’ guide identifies mine subsidence 

and earthquake coverage on page 7. Mine subsidence is one issue 

that is totally different from flood insurance and the State of Ohio 

does have a mine subsidence coverage available. 

Chairman NEY. I created that when I was a State senator. I still 

get a letter to the editor about every year complaining about me 

and Jerry Krupinski, who is not even in office any more. We created that, and as you know, we could not get the mine subsidence 

in Belmont County and Munroe and several other places. Homes 

literally were cracking in half and we could not get anything to 

help them. But we did have controversy on that issue, and as you 

know, we spread the risk by assessing the policy holders in those 

areas, whether you had mine subsidence or not, although 75 percent of Belmont County has got some kind of mine under it, but 

we had to assess and spread that risk. 

People complained about that but they were not in the areas that 

had problems, but if you look at the community as a whole, when 

some houses in Martin’s Ferry, you know, or Blair, to split in half, 

it hurts obviously the families, but it hurts the whole community 

and its valuation, so we spread the risk on that. I do not know if 

that is an idea we could look at for flooding. It was controversial, 

you know, amongst some, but it was a spread of risk and that is 

how we actually could get the insurance. 

So I just wanted to clarify how that worked. 

Mr. DOZIER. With the sewer backup, which is the homeowner policy, as they mentioned earlier, sometimes it is simultaneous with 

the flood and the language of the policy sometimes specifically says 

we will not pay if it is simultaneous with the flood. So it is really 

somewhat policy-specific as to whether or not there is coverage or 

not. And you are right, there could be three things going on at the 

same time—erosions, foundations are not covered by homeowners 

insurance generally, when they are knocked off anyway. So there 

are some areas of insurance where there just is not anyone out 

there who is willing to accept the risk because of the nature of the 

risk, foundations being one of them. There is just no one that 

wants to cover foundations when they get swept off and they are 

not covered under the NFIP, as far as I know. 

Chairman NEY. I am assuming that if that was to happen, it 

would have to be a spreading of the risk around, which caused the 

controversy of assessing people that may not ever use it. 

Mr. DOZIER. Right. 

Chairman NEY. But again, you never know if your hillside is 

going to slide. 

Yes, Cindy. 

Ms. CRECELIUS. Chairman Ney, if I might, we did not look at it 

in terms of single insurance coverage or coverage of all the collateral damage, but that idea and modeling off of the Fair Housing 

Plan and subsidence insurance was discussed following the 1998 

flood and again following the 2000 flood at the State level. Trying 

to come up with a similar risk pool, that would collect a reasonable 

fee across the board because we have flooding in all 88 counties 

and 700 communities, plus; in order to provide some type of mechanism that would either leverage mitigation dollars at the Federal 

36

level or provide a State pool that would help manage that. But it 

did not get a lot of attention at the State level. 

Chairman NEY. Okay. A question I had for Mr. Berginnis. You 

mentioned in previous hearings a problem with State and community caps on spending for mitigation. Do you want to elaborate on 

that a little bit about the mitigation part and the caps on the 

spending? 

Mr. BERGINNIS. Yes, at least on the caps, it is very specific to the 

flood mitigation assistance program, the FMA program. Prior to 

the 2004 Reform Act, the FMA program I think was funded annually $20 million nationwide, and so there were first State and first 

community caps on the FMA assistance. With the Reform Act and 

the fact that the pilot program that FMA has essentially doubled—

the pilot program is out there and the individual program is out 

there, and a possibility of up to $90 million in additional funding 

for mitigation, those caps could be problematic in areas that are 

the high repetitive loss areas. And again, maybe not such a big 

issue here in Ohio because we do not have, proportionate to other 

States, a large number of repetitive loss properties. However, in 

those States and communities that do, those caps could be very 

problematic, because the objective is to address those repetitive loss 

properties, and therefore, reduce the burden on the funds to increase premiums every year. 

Chairman NEY. Another question I had, FEMA had stated earlier 

that some of the new information that is out there on consumer 

education and policies has went to the States through the emergency management. Has that filtered to you? 

Ms. LEVENGOOD Not to our county, I do not know if it has been 

to other counties or not, but not to us. 

Mr. QUINLIN. I have not seen much of anything on it. 

Chairman NEY. We can find out with the State EMA because 

FEMA has direct contact with them and that information is there. 

Of course, it is new, so we can see about running that down. 

Ms. ROSKOVICH. I have a question. I just remembered when 

FEMA was coming in, they needed to have a paper stating I did 

not have flood insurance and M.C. Thomas was my independent insurance agent, and I called him, he said everything was touched 

by water, it was not covered. So I said FEMA wanted a letter stating I did not have flood insurance. Well, he wrote that my policy 

would expire like in a month or 60 days or something at 12:00 midnight and that they wouldn’t even be able to sell me flood insurance. 

Chairman NEY. Because? 

Ms. ROSKOVICH. That was stated on that letter. 

Mr. RILEY. That is a private insurance company. 

Ms. ROSKOVICH. Well, Westfield Insurance Company is the same 

insurance company I had flood insurance with on Wheeling Island 

when I lived there. And I lived there for 6 years and I had insurance with them. But it was not through M.C. Thomas, it was 

through another independent agent in I think Roseberg. And I had 

flood insurance with them through them. But I still have the letter, 

I kept it, I made two or three copies so that I did not lose it. But 

it states that they could not even sell me with flood insurance if 

I had needed it, which I thought was real odd. 

37

Chairman NEY. Did it state why, do you remember? 

Ms. ROSKOVICH. No, it was a two sentence letter. And you was 

asking me about the time I bought that property. My 1980’s get 

mixed up a little bit, bought the property in 1989, the summer of 

1989, and move into the house around Christmas time of 1990. 

Chairman NEY. And refinanced in 1999. 

Ms. ROSKOVICH. And refinanced in 1999. I get my 1980’s mixed 

up. Just to clarify that, thank you. 

Mr. RILEY. I think that is why we have the National Flood Insurance Program, I do not think—it is very difficult to get private insurance for homes when it comes to flooding. Mr. Maurstad? Yes, 

that is not uncommon that you would get a letter saying you would 

not be covered. 

Ms. ROSKOVICH. But I had it through the same company on the 

island. 

Chairman NEY. The island she is referring to floods easily and 

many times. 

Ms. ROSKOVICH. Water comes up. 

Chairman NEY. Wheeling Island. 

Mr. RILEY. I understand. Private insurance companies give insurance on Wheeling Island? 

Mr. MAURSTAD. The company she may be referring to may not 

be one of the Write Your Own companies, that has arrangements 

with the National Flood Insurance Program. 

Ms. ROSKOVICH. But I had flood insurance with them when I 

lived on the island. 

Chairman NEY. The National Flood Insurance Program, as Mr. 

Riley points out, was created because if you did not have it, there 

would be many, many cases where you have no form of relief. 

We can again check. 

Ms. ROSKOVICH. It just dawned on me that they said they could 

not even sell it to me. 

Chairman NEY. A question I had, Mr. Dozier, there was a statement by Rev. Upson that some people had their policies canceled 

without their knowledge, which there was also the issue of passing 

on the coverage or not and they did not know, but also policies canceled without their knowledge. What about the State insurance, do 

you know the laws on that? 

Mr. DOZIER. I can only address the laws that deal with State regulated issues. Every policy in the State has to have a cancellation 

provision and they have to be notified. But I cannot speak to the 

NFIP policy as to whether or not there is a notification procedure 

and as to what they have to be told when the policy is canceled. 

Mr. RILEY. I believe that was in our legislation, that is part of 

our legislation, part of the consumer protection division, which may 

not have trickled down yet, but I think there is a notice provision 

in there. Mr. Maurstad? 

Mr. MAURSTAD. Yes, the requirement or the arrangement with 

the Write Your Own companies is that they have the same notification provisions for their flood policies that they do have on the balance of their portfolio. The requirement is that they mirror the private sector as much as possible. This issue has come up before and 

when we have looked into it, some of the difficulty has been in tenant situations where the notice for cancellation of the policy goes 

38

to the owner of the property that may live somewhere else other 

than the community of that property. The notice goes to the policy 

holder and not necessarily to the tenant. And sometimes they just 

get misplaced. 

But the point is that they are supposed to be the same notification of cancellation of a policy or nonrenewal of a policy for nonpayment or whatever the circumstances may be that they would 

have under their other portfolio. 

Chairman NEY. Yes, Reverend? 

Rev. UPSON. My question, the point being, and I may direct that 

to you also, if a Write Your Own company would go ahead and, because they felt they paid too much out after a natural disaster, say 

that they are dropping those, and that was what the client came 

back to explain. 

Mr. MAURSTAD. I have not heard of that circumstance. Again, I 

am not disputing whatsoever the information that you have been 

provided. 

Rev. UPSON. Sure. 

Mr. MAURSTAD. There really would be no reason or incentive for 

the Write Your Own company to stop writing insurance policies because of losses, because they do not pay for the losses, the National 

Flood Insurance Program pays and reimburses the company for the 

losses that they have as a result of whether it be a natural disaster 

or loss on the policy whatsoever. So that is one of the benefits associated again with the program, is that the coverage is available because of the Federal program backing the losses through that program. By the collection of premiums from all the 4.7 million policy 

holders that are part of the program, it spreads the risk among the 

4.7, but the Federal Government backs it. 

Chairman NEY. Any other comments? 

Ms. CRECELIUS. Yes, Chairman Ney. One other point I would like 

to clarify a little bit or maybe shed a different perspective on that 

I believe Rev. Upson was speaking about; that is the transition 

from a group flood insurance policy to a standard flood insurance 

policy. As part of the Reform Act provisions of the Stafford Act, in 

trying to do a better job with mitigation amendments kicked in the 

requirement for group policies if a client receives Federal assistance. That rate is set basically to cover the Federal assistance, so 

it is a lower amount, or if you will, a false premium idea to a homeowner. Then when they become the party that is responsible for 

maintaining insurance and they go to the local agent, it is either 

a subsidized policy or an actuarially rated standard flood insurance 

policy, and the cost generally does increase. We have had complaints from the agent sector saying they are in a ‘‘no-win’’ situation because homeowners and policy holders do not believe them 

when they tell them the $200 premium that you got as part of the 

disaster now goes to the average premium of $600 for a homeowner’s policy. 

Chairman NEY. I see. 

Ms. CRECELIUS. So that might help clarify I think what Rev. 

Upson was trying to convey, a perceived increase in cost. 

Chairman NEY. Okay. I want to thank everybody today for your 

time. I also want to introduce Leslie Applegart, our field rep who 

39

also has worked with many of you constituents when they called 

in with flooding issues. 

I want to thank both panels and especially this panel because I 

think this is very productive for us. It will allow us to put this in 

the record for Washington. Also to compare across the Nation as 

we hear things. The visibility we have had from the hearings that 

we have had in Washington has brought people out of the woodwork that now call to the House, U.S. House, and tell their story 

and what went wrong. In order to help other people, we need to 

know what went wrong, what we can do to try to always correct 

it. 

I also gathered from here today that it deals a lot also with education and information and how to get it out there so people know 

where they are standing and not standing and are at least better 

able to prepare for such terrible trauma that hits them. 

And also, I would just like to note that some Members of the 

House who are not here today may have additional questions for 

the panel and they may want to submit them in writing. So without objection, the hearing record, this record of the hearing, will remain open for 30 days and members can submit additional questions. And if you have additional information you would like to submit, you may do that. 

Also, beyond the record, I would also like to note that we will be 

communicating with all of you to follow up on some things that we 

have heard today. And again, I think this helps nationally what 

you have done today, to give of your time and your stories and we 

look forward to following back up so that hopefully we can, during 

this trauma at least take some of the problems out of it so people 

have a clear understanding of where they stand with it. 

With that, I want to thank you and the hearing is concluded. 

Thank you. 

[Whereupon at 12:20 p.m., the subcommittee was adjourned.] 

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