amendments to title xii of the national housing act

amendments to title xii of the national housing act Sec. 602. (a) Section 1201 of the National Housing Act is amended to read as follows: “program authority “Sec. 1201. (a) The Secretary is authorized to establish and carry out the programs provided for in parts A, B. C, and D of this title. “(b) (1) The powers of the Secretary under this title shall terminate on April 30, 1975, except to the extent necessary— “(A) to continue reinsurance and direct insurance in accordance with the provisions of sections 1223(b) and 1231(c) until April 30, 1978; “(B) to process, verify, and pay claims for reinsured losses and directly insured losses and perform other necessary functions in connection therewith: and “(C) to complete the liquidation and termination of the reinsurance and direct insurance programs. (2) On April 30, 1978, or as soon thereafter as possible, the Secretary shall submit to the Congress, for its approval, a plan for the liquidation and termination of the reinsurance and direct insurance programs.” (b) Section 1203(a) of such Act is amended by redesignating paragraphs (1) through (13) as paragraphs (4) through (16), respectively, and by inserting immediately after and below “the term—” the following new paragraphs: “(1) ‘affordable rate’ means such premium rate as the Secretary determines would permit the purchase of a specific type of insurance coverage by a reasonably prudent person in similar circumstance with due regard to the costs and benefits involved; “(2) ‘crime insurance’ means insurance against losses resulting from robbery, burglary, larceny, and similar crimes, and may include broad form personal theft insurance, mercantile open stock insurance, mercantile robbery and mercantile safe burglary insurance, storekeepers burglary and robbery insurance, office burglary and robbery insurance, and may include business interruption insurance as the Secretary may designate; the term does not include automobile insurance or losses resulting from embezzlement; 84 Stat. 1789 “(3) ‘directly insured losses’ means losses on direct insurance claims and all direct expenses incurred in connection therewith, including but not limited to expenses for processing, verifying, and paying such losses;”. (c) Section 1221(a) (2) of such Act is amended by striking out “section 1203(a) (10)” each place it appears and inserting in lieu thereof “section 1203(a) (13)”. (d) Title XII of such Act is amended by redesignating part C and sections 1231 through 1241 as part D and sections 1241 through 1251, respectively, and by inserting after part B the following new part: “Part C—Federal Insurance Against Burglary and Theft “review and program authority “Sec. 1231. (a) The Secretary shall conduct a continuing review of the market availability situation in each of the several States to determine whether crime insurance is available at affordable rates either through the normal insurance market or through a suitable program adopted under State law. “(b) Upon determining pursuant to subsection (a) that, at any time on or after August 1, 1971, a critical market unavailability situation for crime insurance then exists in any State and has not been met through appropriate State action, the Secretary is authorized to make crime insurance available at affordable rates within such State through the facilities of the Federal Government. Such insurance shall be provided upon such terms and conditions, and subject to such deductibles and other restrictions and limitations, as the Secretary deems appropriate, but no such insurance shall be made available to a property which the Secretary determines to be uninsurable or to a property with respect to which reasonable protective measures to prevent loss, consistent with standards established by the Secretary, have not been adopted. “(c) Notwithstanding any other provision of this title, direct, insurance may be continued for the term of the policies written prior to the date of termination of the Secretary’s direct insurance authority under this part, for as long as the insured pays the required direct insurance premiums; except that direct insurance under this part for any risk shall be terminated after notice whenever the Secretary determines that the standard lines of crime insurance otherwise have become available to such property at affordable rates. “use of existing facilities and services “Sec. 1232. In carrying out his responsibilities under this part, the Secretary may utilize— “(1) insurance companies and other insurers, insurance agents and brokers, and insurance adjustment organizations, as fiscal agents of the United States, “(2) officers and employees of the Department of Housing and Urban Development, and such other officers and employees of any executive agency (as defined in section 105 of title 5 of the United States Code) as the Secretary and the head of any such agency may from time to time agree upon, on a reimbursement or other basis, or “(3) both the alternatives specified in paragraphs (1) and (2), or any combination thereof. 84 Stat. 1790 “establishment of affordable rates “Sec. 1233. In estimating the affordable rates for the various crime insurance coverages offered from time to time under this part, the Secretary shall consult with appropriate State insurance authorities and other knowledgeable persons and is authorized to take into consideration the nature and degree of the risks involved, the protective devices employed, the extent of anticipated losses, the prevailing rates for similar coverages in adjacent or comparable areas and territories, the economic importance of the various individual coverages and the type of property involved, and the relative abilities of the particular classes and types of insureds to pay the full estimated costs of such coverages. Nothing in this section shall be construed to prohibit or require either the adoption of uniform national rates or the periodic modification of currently estimated affordable rates for any particular line or subline of coverage, class, State, territory, or risk on the basis of additional information or actual loss experience. “reports on operations “Sec. 1234. The Secretary shall include in his reports to the Congress on the program authorized by this title full and complete information on his Operations and activities under this part, together with such recommendations with respect thereto as he may deem appropriate.” (e) Section 1222 (a) of such Act is amended by striking out “section 1233” and inserting in lieu thereof “section 1243”. (f) Section 1244(c) of such Act (as redesignated by subsection (d) of this section) is amended by striking out “section 1232” and inserting in lieu thereof “section 1242”. (g) Section 1241(a) of such Act (as so redesignated) is amended by inserting “or direct insurance” after “reinsurance”, and by inserting “or property owners” after “insurers”. (h) Section 1241(b) of such Act (as so redesignated) is amended by inserting “or direct insurance” after “reinsurance”. (i) Section 1242(a) of such Act (as so redesignated) is amended— (1) by striking out “the reinsurance program” and inserting in lieu thereof “the reinsurance and direct insurance programs”; (2) by inserting “or direct insurance” after “reinsurance” in paragraphs (1), (2), and (4); (3) by inserting “or property owner” after “any insurer” where it first appears in paragraph (4); and (4) by inserting “or directly insured” after “reinsured” in paragraph (4). (j) Section 1243 of such Act (as so redesignated) is amended— (1) by inserting “and direct insurance” after “reinsurance” in subsection (a) (1) and each place it appeal’s in subsection (b)(1); (2) by striking out “part B” in subsection (b) (1) and inserting in lieu thereof “parts B and C”; and (3) by redesignating clauses (4) and (5) of subsection (b) as clauses (5) and (6), and inserting after clause (3) a new clause as follows: “(4) such amounts which are hereby authorized to be appropriated as may be necessary from time to time to reimburse the fund for losses and expenses (including administrative expenses) incurred in carrying out the program authorized under part C;”. 84 Stat. 1791 (k) Section 1244(a) of such Act (as so redesignated) is amended by striking out “Any insurer or pool acquiring reinsurance” and inserting in lieu thereof “Any insurer, pool, or property owner acquiring reinsurance or direct insurance”. (l) Section 1244(c) of such Act (as so redesignated) is amended by inserting “or direct insurance” after “reinsurance”.