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February 28, 2007

Flood insurance chief claims `no knowledge' of payout discrepancy

The head of the federal flood insurance program on Wednesday startled members of Congress who were examining the insurance industrys response to Hurricane Katrina by saying that he had no knowledge of a widely alleged practice of insurers paying off federal claims while denying private insurance payments. I have no knowledge of any claims paid by the program that should have been paid by wind policies, which is administered by the private sector, David Maurstad, of the Federal Emergency Management Agency, told a House panel. Maurstad said under questioning that when both wind and water damage occurred, FEMA paid the damages as a matter of policy.

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