A top Federal Emergency Management Agency official testified Wednesday that he does not believe that the more than $16 billion in flood insurance claims his agency paid out after Hurricane Katrina should have been instead covered by private insurers.
David Maurstad, FEMA federal insurance administrator, told members of the House Financial Services Oversight Subcommittee that he was unaware of any attempt to defraud the National Flood Insurance Program in the aftermath of Katrina and that his agency has a rigorous oversight process to prevent such problems.
Some panel members were skeptical, noting that private insurers had a financial incentive to label much of the structural damage along the coast as a result of flooding, which is covered under the federal government’s program, rather than under their wind damage policies.
