,,ii  #aac? ,,congress  #a/ ,session    
,s4 #adfa  ,,9 ,,! ,,s5ate ,,( ,,!      
,,unit$ ,,/ates  ,augu/ #a1 #bjac ,mr4  
,nelson introduc$ ! foll[+ bill2 :i* 0  
read twice & ref]r$ to ! ,committee on  
,bank+1 ,h\s+1 & ,urban ,affairs  ,a    
,,bill  ,to e/abli% a ,national         
,cata/rophe ,risks ,consortium & a      
,national ,home[n]s' ,insurance         
,/abilization ,program1 & = o!r         
purposes4  #a4 ,%ort title2 table (     
cont5ts  7a7 ,%ort title ,?is ,act may  
be cit$ z ! ,home[n]s' ,def5se ,act (   
#bjac4  7b7 ,table ( cont5ts ,! table ( 
cont5ts = ?is ,act is z foll[s3  ,sec4  
#a4 ,%ort title2 table ( cont5ts4 ,sec4 
#b4 ,f9d+s & purposes4 ,sec4 #c4        
,qualifi$ re9surance programs4 ,sec4 #d4
 ,def9itions4 ,sec4 #e4 ,regulations4   
,,title ,i--,national ,cata/rophe ,risk 
,consortium ,sec4 #aja4 ,e/abli%m5t2    
/atus2 pr9cipal (fice2 memb]%ip4 ,sec4  
#ajb4 ,functions4 ,sec4 #ajc4 ,p[]s4    
,sec4 #ajd4 ,nonpr(it entity2 conflicts 
( int]e/2 audits4 ,sec4 #aje4           

,managem5t4 ,sec4 #ajf4 ,/aff2 exp]ts & 
consultants4 ,sec4 #ajg4 ,f$]al         
liability4 ,sec4 #ajh4 ,au?orization (  
appropriations4 ,,title ,,ii--,national 
,home[n]s' ,insurance ,/abilization     
,program ,sec4 #bja4 ,e/abli%m5t4 ,sec4 
#bjb4 ,liquidity loans & cata/rophic    
loans = ,/ate & regional re9surance     
programs4 ,sec4 #bjc4 ,reports & audits4
 ,sec4 #bjd4 ,fund+4  #b4 ,f9d+s &      
purposes  7a7 ,f9d+s ,! ,congress f9ds  
t--  7#a7 ! ,unit$ ,/ates has a hi/ory (
 cata/rophic natural disa/]s1 includ+   
hurricanes1 tornadoes1 flood1 fire1     
e>?quakes1 & volcanic eruptions2  7#b7  
al?\gh cata/rophic natural disa/]s occur
 infrequ5tly1 !y w cont9ue to occur &   
are pr$ictable2  7#c7 su* disa/]s g5]ate
 l>ge economic losses & a major compon5t
 ( ^? losses comes f damage & de/ruction
 to homes2  7#d7 = ! majority (         
,am]icans1 _! inve/m5t 9 _! home        
repres5ts _! s+le bigge/ asset & !      
protection ( t inve/m5t is p>am\nt to   
economic & social /ability2  7#e7       

hi/orically1 :5 a natural disa/]        
eclipses ! ability ( ! private indu/ry &
 a ,/ate to manage ! loss1 ! ,f$]al     
,gov]nm5t has /epp$ 9 to provide ! fund+
 & s]vices ne$$ = recov]y2  7#f7 ! co/ (
 su* ,f$]al bail-outs are borne by all  
taxpay]s equally1 z !re is no provision 
to repay ! money & res\rces provid$1 :i*
 !reby unfairly burd5s citiz5s :o live 9
 l[] risk communities2  7#g7 z ! risk ( 
cata/rophic losses gr[s1 s d ! risks t  
any premiums collect$ by private insur]s
 = ext5d+ cov]age w be insuffici5t to   
cov] future cata/rophes 7kn[n z tim+    
risk71 & private insur]s1 9 an ef=t to  
protect _! %>ehold]s & policyhold]s 79 !
 case ( mutually own$ companies71 h ?us 
significantly rais$ premiums & curtail$ 
insurance cov]age 9 ,/ates expos$ to    
major cata/rophes2  7#h7 su* effects on 
! insurance indu/ry h be5 h>mful to     
economic activity 9 ,/ates expos$ to    
major cata/rophes & h plac$ significant 
burd5s on exi/+ resid5ts ( su* ,/ates2  
7#i7 ,hurricanes ,katr9a1 ,rita1 &      

,wilma /ruck ! ,unit$ ,/ates 9 #bjje1   
caus+ ov] #bjj1jjj1jjj1jjj 9 total      
economic losses1 & insur$ losses to     
home[n]s 9 excess ( #ej1jjj1jjj1jjj2    
7#aj7 s9ce #bjjd1 ! ,congress has       
appropriat$ m ?an #eh1jjj1jjj1jjj 9     
disa/] relief to ! ,/ates affect$ by    
natural cata/rophes2  7#aa7 ! ,f$]al    
,gov]nm5t has provid$ & w cont9ue to    
provide res\rces to pay = losses f      
future cata/rophes2  7#ab7 :5 ,f$]al    
assi/ance is provid$ to ! ,/ates1       
acc\ntability = ,f$]al funds disburs$ is
 p>am\nt2  7#ac7 ! ,gov]nm5t            
,acc\ntability ,(fice or o!r appropriate
 ag5cies mu/ h ! means 9 place to       
confirm t ,f$]al funds = cata/rophe     
relief h rea*$ ! appropriate victims & h
 contribut$ to ! recov]y ef=t z         
effici5tly z possible s t taxpay] funds 
are n wa/$ & citiz5s are enabl$ to      
rebuild & resume productive activities z
 quickly z possible2  7#ad7 ,/ates t are
 recipi5ts ( ,f$]al funds mu/ be        
responsible to acc\nt = & provide an    

effici5t means = di/ribution ( funds to 
home[n]s to enable ! rapid rebuild+ (   
local economies aft] a cata/rophic ev5t 
)\t unduly burd5+ taxpay]s :o live 9    
areas seldom affect$ by natural disa/]s2
  7#ae7 ,/ate insurance & re9surance    
programs c provide a me*anism = ,/ates  
to ex]cise t responsibility if !y       
appropriately und]write & price risk1 & 
if !y pay claims quickly & )9 e/abli%$  
contractual t]ms2 &  7#af7 ,/ate insur]s
 & re9sur]s1 if appropriately back/opp$ 
!mselves1 c absorb cata/rophic risk     
borne by private insur]s )\t be>+ tim+  
risk1 & ?us enable all insur]s 7:e!r    
,/ate-op]at$ or privately own$7 to      
und]write & price insurance )\t tim+    
risk & 9 su* a way to enc\rage prop]ty  
own]s to pay = ! appropriate insurance  
to protect !mselves & to take /eps to   
mitigate aga9/ ! risks ( disa/] by      
locally appropriate me?ods4  7b7        
,purposes ,! purposes ( ?is ,act are to 
e/abli% a program to provide a ,f$]al   
back/op = ,/ate-sponsor$ insurance      

programs to help home[n]s prep>e = &    
recov] f ! damages caus$ by natural     
cata/rophes1 to enc\rage mitigation &   
prev5tion = su* cata/rophes1 to promote 
! use ( private m>ket capital z a means 
to insure aga9/ su* cata/rophes1 to     
exp$ite ! paym5t ( claims & bett] assi/ 
9 ! f9ancial recov]y f su* cata/rophes4 
#c4 ,qualifi$ re9surance programs  7a7  
,9 g5]al ,= purposes ( ?is ,act only1 a 
program %all be consid]$ to be a        
qualifi$ re9surance program if !        
program--  7#a7 is au?oriz$ by ,/ate law
 = ! purposes describ$ 9 ?is section2   
7#b7 is an entity 9 :i* ! au?oriz+ ,/ate
 ma9ta9s a mat]ial1 f9ancial int]e/2    
7#c7 provides re9surance or             
retrocessional cov]age to und]ly+ prim>y
 insur]s or re9sur]s = losses aris+ f   
all p]sonal resid5tial l9es ( insurance1
 z def9$ 9 ! ,uni=m ,prop]ty  ,casualty 
,product ,cod+ ,matrix publi%$ & ma9ta9$
 by ! ,national ,association (          
,insurance ,commission]s2  7#d7 has a   
gov]n+ body1 a majority ( ^: memb]s are 

public (ficials2  7#e7 provides         
re9surance or retrocessional cov]age to 
und]ly+ prim>y insur]s or re9sur]s =    
losses 9 excess ( su* am\nt t !         
,secret>y has det]m9$ repres5ts a       
cata/rophic ev5t 9 t p>ticul> ,/ate2    
7#f7 is au?oriz$ by a ,/ate t has 9     
effect su* laws1 regulations1 or o!r    
requirem5ts1 z ! ,secret>y %all by      
regulation provide1 t--  7,a7 ensure1 to
 ! ext5t t re9surance cov]age made      
available "u ! qualifi$ re9surance      
program results 9 any co/ sav+s 9       
provid+ insurance cov]age = risks 9 su* 
,/ate1 su* co/ sav+s are reflect$ 9     
premium rates *>g$ to consum]s = su*    
cov]age2  7,b7 require t any new        
con/ruction1 sub/antial rehabilitation1 
& r5ovation insur$ or re9sur$ by !      
program complies ) applicable ,/ate or  
local gov]nm5t build+1 fire1 & safety   
codes2  7,c7 require ,/ate au?oriz$     
insurance entities )9 t ,/ate to e/abli%
 an insurance rate /ructure t takes into
 acc\nt measures to mitigate insurance  

losses2  7,d7 require ,/ate au?oriz$    
insurance & re9surance entities )9 t    
,/ate to e/abli% rates at a level t     
annually produces expect$ premiums t    
%all be suffici5t to pay ! expect$      
annualiz$ co/ ( all claims1 loss        
adju/m5t exp5ses1 & all adm9i/rative    
co/s ( re9surance cov]age (f]$2 &  7,e7 
enc\rage ,/ate au?oriz$ insurance &     
re9surance entities )9 t ,/ate to       
e/abli% rates t d n involve             
cross-subsidization betwe5 any sep>ate  
prop]ty & casualty l9es cov]$ "u ! ,/ate
 au?oriz$ insurance or re9surance       
entity2 &  7#g7 complies ) su*          
additional organizational1 und]writ+1 & 
f9ancial requirem5ts z ! ,secret>y %all1
 by regulation1 provide to c>ry out !   
purposes ( ?is ,act4  7b7 ,transitional 
,me*anisms ,= ! #e-ye> p]iod beg9n+ on !
 date ( enactm5t ( ?is ,act1 9 ! case ( 
a ,/ate t does n h a qualifi$ re9surance
 program = ! ,/ate1 a ,/ate residual    
insurance m>ket entity = su* ,/ate %all 
be consid]$ to be a qualifi$ re9surance 

program1 b only if su* ,/ate residual   
insurance m>ket entity 0 9 exi/5ce be=e 
su* date ( enactm5t4  7c7               
,prec]tification ,! ,secret>y %all      
e/abli% proc$ures & /&>ds = ,/ate &     
regional re9surance programs & ! ,/ate  
residual insurance m>ket entities       
describ$ 9 subsection 7b7 to apply to ! 
,secret>y at any "t = c]tification 7&   
rec]tification7 z qualifi$ re9surance   
programs4  7d7 ,re9surance ,to cov]     
exposure ,?is section may n be con/ru$  
to limit or prev5t any insur] f obta9+  
re9surance cov]age = insur$ losses      
reta9$ by insur]s pursuant to ?is       
section1 nor %all ! obta9+ ( su* cov]age
 affect ! calculation ( ! am\nt ( any   
loan "u ?is ,act4  #d4 ,def9itions ,=   
purposes ( ?is ,act1 ! foll[+ def9itions
 %all apply3  7#a7 ,ceil+ cov]age level 
,! t]m ceil+ cov]age level means1 )     
respect to a qualifi$ re9surance        
program1 ! maximum liability1 "u law1 t 
c\ld be incurr$ at any "t by ! qualifi$ 
re9surance program4  7#b7 ,commission ,!

 t]m ,commission means ! ,national      
,commission on ,natural ,cata/rophe     
,prep>ation & ,protection e/abli%$ "u   
title ,,ii4  7#c7 ,consortium ,! t]m    
,consortium means ! ,national           
,cata/rophic ,risk ,consortium e/abli%$ 
"u title ,i4  7#d7 ,insur$ loss ,! t]m  
insur$ loss means any loss insur$ by a  
qualifi$ re9surance program4  7#e7      
,qualifi$ re9surance program ,! t]m     
qualifi$ re9surance program means a     
,/ate or regional program t meets !     
requirem5ts ( section #c4  7#f7         
,secret>y ,! t]m ,secret>y means !      
,secret>y ( ! ,treasury4  7#g7 ,/ate ,! 
t]m ,/ate includes ! sev]al ,/ates1 !   
,di/rict ( ,columbia1 ! ,commonweal? (  
,pu]to ,rico1 ,guam1 ! ,commonweal? ( ! 
,nor!rn ,m>iana ,isl&s1 ! ,unit$ ,/ates 
,virg9 ,isl&s1 & ,am]ican ,samoa4  #e4  
,regulations ,! ,secret>y %all issue su*
 regulations z may be necess>y to c>ry  
out ?is ,act4  ,i ,national ,cata/rophe 
,risk ,consortium  #aja4 ,e/abli%m5t2   
/atus2 pr9cipal (fice2 memb]%ip  7a7    

,e/abli%m5t ,!re is e/abli%$ an entity  
to be kn[n z ! ,national ,cata/rophe    
,risk ,consortium4  7b7 ,/atus ,!       
,consortium is n a dep>tm5t1 ag5cy1 or  
in/rum5tality ( ! ,unit$ ,/ates         
,gov]nm5t4  7c7 ,pr9cipal (fice ,!      
pr9cipal (fice & place ( bus9ess ( !    
,consortium %all be su* location )9 !   
,unit$ ,/ates det]m9$ by ! ,bo>d (      
,directors to be ! mo/ advantage\s =    
c>ry+ out ! purpose & functions ( !     
,consortium4  7d7 ,memb]%ip ,any ,/ate t
 has e/abli%$ a re9surance fund or has  
au?oriz$ ! op]ation ( a ,/ate residual  
insurance m>ket entity %all be eligible 
to p>ticipate 9 ! ,consortium4  #ajb4   
,functions ,! ,consortium %all--  7#a7  
"w ) all ,/ates1 p>ticul>ly ^?          
p>ticipat+ 9 ! ,consortium1 to ga!r &   
ma9ta9 an inv5tory ( cata/rophe risk    
obligations held by ,/ate re9surance    
funds & ,/ate residual insurance m>ket  
entities2  7#b7 at ! discretion ( !     
affect$ memb]s & on a conduit basis1    
issue securities & o!r f9ancial         

in/rum5ts l9k$ to ! cata/rophe risks    
insur$ or re9sur$ ?r\gh memb]s ( !      
,consortium 9 ! capital m>kets2  7#c7   
coord9ate re9surance contracts betwe5   
p>ticipat+1 qualifi$ re9surance funds & 
private p>ties2  7#d7 act z a c5traliz$ 
repository ( ,/ate risk in=mation t c be
 access$ by private-m>ket p>ticipants   
seek+ to p>ticipate 9 ! transactions    
describ$ 9 p>agraphs 7#b7 & 7#c7 ( ?is  
section2  7#e7 use a cata/rophe risk    
database to p]=m rese>* & analysis t    
enc\rages /&>dization ( ! risk-l9k$     
securities m>ket2  7#f7 p]=m any o!r    
functions1 o!r ?an assum+ risk or       
incurr+ debt1 t are deem$ necess>y to   
aid 9 ! transf] ( cata/rophe risk f     
p>ticipat+ ,/ates to private p>ties2 &  
7#g7 submit annual reports to ,congress 
describ+ ! activities ( ! ,consortium = 
! prec$+ ye>4  #ajc4 ,p[]s ,!           
,consortium--  7#a7 may make & p]=m su* 
contracts & o!r agreem5ts ) any         
individual or o!r private or public     
entity h[ev] designat$ & :]ev] situat$1 

z may be necess>y = c>ry+ out !         
functions ( ! ,consortium2 &  7#b7 %all 
h su* o!r p[]s1 o!r ?an ! p[] to assume 
risk or incur debt1 z may be necess>y & 
incid5t to c>ry+ out ?is ,act4  #ajd4   
,nonpr(it entity2 conflicts ( int]e/2   
audits  7a7 ,nonpr(it entity ,!         
,consortium %all be a nonpr(it entity & 
no "p ( ! net e>n+s ( ! ,consortium %all
 inure to ! b5efit ( any memb]1 f\nd]1  
contributor1 or individual4  7b7        
,conflicts ( int]e/ ,no director1 (fic]1
 or employee ( ! ,consortium %all 9 any 
mann]1 directly or indirectly1          
p>ticipate 9 ! delib]ation ^u or !      
det]m9ation ( any "q affect+ 8 or h]    
p]sonal int]e/s or ! int]e/s ( any      
,consortium1 p>tn]%ip1 or organization 9
 :i* he or %e is directly or indirectly 
int]e/$4  7c7 ,audits  7#a7 ,annual     
audit ,! f9ancial /atem5ts ( !          
,consortium %all be audit$ annually 9   
accordance ) g5]ally accept$ audit+     
/&>ds by indep5d5t c]tifi$ public       
acc\ntants4  7#b7 ,reports ,! report (  

ea* annual audit pursuant to p>agraph   
7#a7 %all be includ$ 9 ! annual report  
submitt$ 9 accordance ) section #ajb7g74
  #aje4 ,managem5t  7a7 ,bo>d (         
directors2 memb]%ip2 designation (      
*airp]son  7#a7 ,bo>d ( directors ,!    
managem5t ( ! ,consortium %all be ve/$ 9
 a bo>d ( directors 7ref]r$ to 9 ?is    
title z ! ,bo>d7 compos$ ( n few] ?an #c
 memb]s4  7#b7 ,*airp]son ,! ,secret>y1 
or ! designee ( ! ,secret>y1 %all s]ve z
 ! *airp]son ( ! ,bo>d4  7#c7 ,memb]%ip 
,! memb]s ( ! ,bo>d %all include--  7,a7
 ! ,secret>y ( ,homel& ,security & !    
,secret>y ( ,comm]ce1 or ! designees (  
su* ,secret>ies1 respectively1 b only   
dur+ su* times z !re are few] ?an #b    
,/ates p>ticipat+ 9 ! ,consortium2 &    
7,b7 a memb] f ea* ,/ate p>ticipat+ 9 ! 
,consortium1 :o %all be appo9t$ by su*  
,/ate4  7b7 ,bylaws ,! ,bo>d may        
prescribe1 am5d1 & repeal su* bylaws z  
may be necess>y = c>ry+ out ! functions 
( ! ,consortium4  7c7 ,comp5sation1     
actual1 necess>y1 & transportation      

exp5ses  7#a7 ,non-,f$]al employees ,a  
memb] ( ! ,bo>d :o is n o!rwise employ$ 
by ! ,f$]al ,gov]nm5t %all be entitl$ to
 receive ! daily equival5t ( ! annual   
rate ( basic pay payable = level ,,iv ( 
! ,executive ,s*$ule "u section #ecae ( 
title #e1 ,unit$ ,/ates ,code1 z 9      
effect f "t to "t1 = ea* day 7includ+   
travel "t7 dur+ :i* su* memb] is engag$ 
9 ! actual p]=mance ( duties ( !        
,consortium4  7#b7 ,f$]al employees ,a  
memb] ( ! ,bo>d :o is an (fic] or       
employee ( ! ,f$]al ,gov]nm5t %all s]ve 
)\t additional pay 7or b5efits 9 !      
nature ( comp5sation7 = s]vice z a memb]
 ( ! ,consortium4  7#c7 ,travel exp5ses 
,memb]s ( ! ,consortium %all be entitl$ 
to receive travel exp5ses1 includ+ p]   
diem 9 lieu ( subsi/5ce1 equival5t to ^?
 set =? 9 sub*apt] ,i ( *apt] #eg (     
title #e1 ,unit$ ,/ates ,code4  7d7     
,quorum ,a majority ( ! ,bo>d %all      
con/itute a quorum4  7e7 ,executive     
director ,! ,bo>d %all appo9t an        
executive director ( ! ,consortium1 on  

su* t]ms z ! ,bo>d may det]m9e4  #ajf4  
,/aff2 exp]ts & consultants  7a7 ,/aff  
7#a7 ,appo9tm5t ,! ,bo>d ( ! ,consortium
 may appo9t & t]m9ate su* o!r /aff z are
 necess>y to enable ! ,consortium to    
p]=m its duties4  7#b7 ,comp5sation ,!  
,bo>d ( ! ,consortium may fix !         
comp5sation ( ! executive director & o!r
 /aff4  7b7 ,exp]ts & consultants ,!    
,bo>d %all procure ! s]vices ( exp]ts & 
consultants z ! ,bo>d consid]s          
appropriate4  #ajg4 ,f$]al liability ,! 
,f$]al ,gov]nm5t & ! ,consortium %all n 
be> any liabilities aris+ f ! actions ( 
! ,consortium4 ,p>ticipat+ ,/ates %all  
reta9 all cata/rophe risk until !       
completion ( a transaction describ$ 9   
p>agraphs 7#b7 & 7#c7 ( section #ajb4   
#ajh4 ,au?orization ( appropriations    
,!re are au?oriz$ to be appropriat$ to  
c>ry out ?is title #bj1jjj1jjj = ea* (  
fiscal ye>s #bjac ?r\gh #bjah4  ,,ii    
,national ,home[n]s' ,insurance         
,/abilization ,program  #bja4           
,e/abli%m5t ,! ,secret>y %all c>ry out a

 program "u ?is title to make liquidity 
loans & cata/rophic loans "u section    
#bjb to qualifi$ re9surance programs to 
ensure ! solv5cy ( su* programs1 to     
improve ! availability & af=dability (  
home[n]s' insurance1 to provide inc5tive
 = risk transf] to ! private capital &  
re9surance m>kets1 & to spread ! risk ( 
cata/rophic f9ancial loss result+ f     
natural disa/]s & cata/rophic ev5ts4    
#bjb4 ,liquidity loans & cata/rophic    
loans = ,/ate & regional re9surance     
programs  7a7 ,contracts ,! ,secret>y   
may ent] into a contract ) a qualifi$   
re9surance program to c>ry out ?is      
title1 z ! ,secret>y may deem           
appropriate4 ,! contract %all include1  
at a m9imum1 ! conditions = loan        
eligibility set =? 9 ?is section4  7b7  
,conditions = loan eligibility ,a loan  
"u ?is section may be made only to a    
qualifi$ re9surance program & only if-- 
7#a7 be=e ! loan is made--  7,a7 ! ,/ate
 or regional re9surance program submits 
to ! ,secret>y a report sett+ =?1 9 su* 

=m & includ+ su* in=mation z ! ,secret>y
 %all require1 h[ ! program plans to    
repay ! loan2 &  7,b7 bas$ ^u ! report (
 ! program1 ! ,secret>y det]m9es t !    
program c meet its repaym5t obligation  
"u ! loan & c]tifies t ! program c meet 
su* obligation2  7#b7 ! program _c      
access capital 9 ! private m>ket1       
includ+ ?r\gh cata/rophe bonds & o!r    
securities sold ?r\gh ! facility creat$ 
9 title ,i ( ?is ,act1 z det]m9$ by !   
,secret>y1 & a loan may be made to su* a
 qualifi$ re9surance program only to !  
ext5t t su* program _c access capital 9 
! private m>ket2  7#c7 ! ,secret>y      
det]m9es t an ev5t has result$ 9 insur$ 
losses 9 a ,/ate ) a qualifi$ re9surance
 program2  7#d7 ! loan complies ) !     
requirem5ts "u subsection 7d7 & or 7e71 
z applicable2 &  7#e7 ! loan is af=d$ ! 
full fai? & cr$it ( ! ,/ate & ! ,/ate   
demon/rates to ! ,secret>y t x has !    
ability to repay ! loans4  7c7 ,m&atory 
assi/ance = qualifi$ re9surance programs
 ,! ,secret>y %all1 ^u ! reque/ ( a     

qualifi$ re9surance program & subject to
 subsection 7b71 make a loan "u         
subsection 7d7 or 7e7 = su* program 9 ! 
am\nt reque/$ by su* program 7subject to
 ! limitations "u subsections 7d77#b7 & 
7e77#b71 respectively74  7d7 ,liquidity 
loans ,a loan "u ?is subsection = a     
qualifi$ re9surance program %all be     
subject to ! foll[+ requirem5ts3  7#a7  
,preconditions ,! ,secret>y %all h      
det]m9$ t ! qualifi$ re9surance         
program--  7,a7 has a capital liquidity 
%ortage1 9 accordance ) regulations t ! 
,secret>y %all e/abli%2 &  7,b7 _c      
access capital m>kets at effective rates
 ( int]e/ l[] ?an ^? provid$ 9 p>agraph 
7#c74  7#b7 ,am\nt ,! pr9cipal am\nt ( !
 loan may n exce$ ! ceil+ cov]age level 
= ! qualifi$ re9surance program4  7#c7  
,rate ( int]e/ ,! loan %all be> int]e/  
at an annual rate #c p]c5tage po9ts     
high] ?an m>ketable obligations ( !     
,treasury hav+ ! same t]m to maturity z 
! loan & issu$ dur+ ! mo/ rec5tly       
complet$ mon?1 z det]m9$ by ! ,secret>y1

 or su* high] rate z may be necess>y to 
ensure t ! am\nts ( int]e/ paid "u su*  
loans exce$ ! sum ( ! co/s 7z su* t]m is
 def9$ 9 section #ejb ( ! ,f$]al ,cr$it 
,re=m ,act ( #aiij 7#b ,u4,s4,c4        
#ffa;a77 ( su* loans1 ! adm9i/rative    
co/s involv$ 9 c>ry+ out a program "u   
?is title = su* loans1 & any incid5tal  
effects on gov]nm5tal receipts &        
outlays4  7#d7 ,t]m ,! loan %all h a t]m
 to maturity ( n less ?an #e ye>s & n m 
?an #aj ye>s4  7e7 ,cata/rophic loans ,a
 loan "u ?is subsection = a qualifi$    
re9surance program %all be subject to ! 
foll[+ requirem5ts3  7#a7 ,preconditions
 ,! ,secret>y %all h det]m9$ t an ev5t  
has result$ 9 insur$ losses 9 a ,/ate ) 
a qualifi$ re9surance program & t su*   
insur$ losses 9 su* ,/ate are 9 excess (
 #aej p]c5t ( ! aggregate am\nt ( direct
 writt5 premium = privately issu$       
prop]ty & casualty insurance1 = risks   
locat$ 9 t ,/ate1 ov] ! cal5d> ye>      
prec$+ su* ev5t1 9 accordance )         
regulations t ! ,secret>y %all e/abli%4 

7#b7 ,am\nt ,! pr9cipal am\nt ( ! loan  
made pursuant to an ev5t ref]r$ to 9    
p>agraph 7#a7 may n exce$ ! am\nt by :i*
 ! insur$ losses su/a9$ z a result ( su*
 ev5t exce$ ! ceil+ cov]age level = !   
qualifi$ re9surance program4  7#c7 ,rate
 ( int]e/ ,! loan %all be> int]e/ at an 
annual rate #j4bj p]c5tage po9ts high]  
?an m>ketable obligations ( ! ,unit$    
,/ates ,treasury hav+ a t]m to maturity 
( n less ?an #aj ye>s & issu$ dur+ ! mo/
 rec5tly complet$ mon?1 z det]m9$ by !  
,secret>y1 or su* high] rate z may be   
necess>y to ensure t ! am\nts ( int]e/  
paid "u su* loans exce$ ! sum ( ! co/s  
7z su* t]m is def9$ 9 section #ejb ( !  
,f$]al ,cr$it ,re=m ,act ( #aiij 7#b    
,u4,s4,c4 #ffa;a77 ( su* loans1 !       
adm9i/rative co/s involv$ 9 c>ry+ out a 
program "u ?is title = su* loans1 & any 
incid5tal effects on gov]nm5tal receipts
 & outlays4  7#d7 ,t]m ,! loan %all h a 
t]m to maturity ( n less ?an #aj ye>s4  
7f7 ,use ( funds ,am\nts f a loan "u ?is
 section %all only be us$ to provide    

re9surance or retrocessional cov]age to 
und]ly+ prim>y insur]s or re9sur]s =    
losses aris+ f all p]sonal real prop]ty 
or home[n]s' l9es ( insurance1 z def9$ 9
 ! ,uni=m ,prop]ty  ,casualty ,product  
,cod+ ,matrix publi%$ & ma9ta9$ by !    
,national ,association ( ,insurance     
,commission]s4 ,su* am\nts %all n be us$
 = any o!r purpose4  #bjc4 ,reports &   
audits ,! ,secret>y %all submit a report
 to ! ,presid5t & ! ,congress annually t
 id5tifies & describes any loans made "u
 ?is title dur+ su* ye> & any repaym5ts 
dur+ su* ye> ( loans made "u ?is title1 
& describes actions tak5 to ensure      
acc\ntability ( loan funds4 ,! ,secret>y
 %all provide = regul> audits to be     
conduct$ = ea* loan made "u ?is title1 &
 %all make ! results ( su* audits       
publicly available4  #bjd4 ,fund+  7a7  
,program fee  7#a7 ,9 g5]al ,! ,secret>y
 may e/abli% & collect1 f qualifi$      
re9surance programs t are prec]tifi$    
pursuant to section #c7;c71 a reasonable
 fee1 z may be necess>y to (fset !      

exp5ses ( ! ,secret>y 9 connection )    
c>ry+ out ! responsibilities ( !        
,secret>y "u ?is title1 includ+--  7,a7 
co/s ( develop+1 implem5t+1 & c>ry+ out 
! program "u ?is title2 &  7,b7 co/s (  
provid+ = prec]tification pursuant to   
section #c7;c7 ( ,/ate & regional       
re9surance programs z qualifi$          
re9surance programs4  7#b7 ,adju/m5t ,! 
,secret>y may1 f "t to "t1 adju/ ! fee  
"u p>agraph 7#a7 z appropriate bas$ on  
exp5ses ( ! ,secret>y ref]r$ to 9 su*   
p>agraph4  7#c7 ,use ,any fees collect$ 
pursuant to ?is subsection %all be      
cr$it$ z (fsett+ collections ( !        
,dep>tm5t ( ! ,treasury & %all be       
available to ! ,secret>y only = exp5ses 
ref]r$ to 9 p>agraph 7#a74  7b7 ,co/s ( 
loans2 adm9i/rative co/s ,to ! ext5t t  
am\nts ( negative cr$it subsidy are     
receiv$ by ! ,secret>y 9 any fiscal ye> 
pursuant to loans made "u ?is title1 su*
 am\nts %all be available = co/s 7z su* 
t]m is def9$ 9 section #ejb ( ! ,f$]al  
,cr$it ,re=m ,act ( #aiij 7#b ,u4,s4,c4 

#ffa;a77 ( su* loans & = co/s ( c>ry+   
out ! program "u ?is title = su* loans4 
7c7 ,full taxpay] repaym5t ,! ,secret>y 
%all require ! full repaym5t ( all loans
 made "u ?is title4 ,if ! ,secret>y     
det]m9es at any "t t su* full repaym5t w
 n made1 or is likely n to be made1 !   
,secret>y %all promptly submit a report 
to ! ,congress expla9+ :y su* full      
repaym5t w n be made or is likely n to  
be made4