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Senator Bush. For sales purposes?
Mr. YAFFE. Yes.

Senator Bush. You would use established insurance agents who
represent the private companies !
Mr. YAFFE. Yes, sir.
Senator Bush. In sales of casualty insurance?

Mr. YAFFE. Yes, sir; and sell it directly, because if it is handled through the insurance companies, those insurance companies are going to have to hire girls to take care of those policies.

Senator Bush. Then under your plan would you have the Federal Authority organize an insurance staff of appraisers and adjusters?

Mr. YAFFE. I do not think so. I do not think it is necessary.

Senator Bush. Who is going to decide how much a fellow will get back under his policy?

Mr. YAFFE. That can very easily be handled, sir, through the various adjustment bureaus as they are set up right now. We have home offices here in Hartford who have their own adjustment bureaus. On the other hand, we have insurance companies doing business in Hartford who cannot afford to maintain their own adjustment staff. They go directly to these adjustment bureaus. They engage them to settle claims for them. The insurance companies have their hands full. It has taken an awfully long time to settle some of the claims that came about in this last disaster business, when supposedly they were not selling disaster insurance.

Sir, you did ask me a question further back. I think that this paragraph partially answers that. You could have coverage of $100,000 on the real property—$100,000 on the contents. The important thing is that where there is a concern with $5 million of assets, there is a good chance for an insurance agent to go out and do a good job and sell them insurance with a private company.

Senator Bush. Over and above?
Mr. YAFFE. Over and above that minimum.

I say, it is an American plan because it means that every American will be his brother's keeper. When something goes wrong a man can pick himself up on a dignified basis; and, gentlemen, that is awfully important. That is more important than all of the relief and all of the benefits. It is on a dignified basis because he has provided for himself and has paid for and is entitled to the benefits he would receive.

Senator Bush. Well, sir, I want to congratulate you on that presentation. That was a very thoughtful and constructive presentationone of the most interesting we have had. The committee is very grateful to you.

Mr. YAFFE. Thank you.

Mr. EDELSTEIN. Might I say in behalf of Senator Lehman that a lot of these points will certainly be taken into consideration in working on our version of the bill.

Mr. YAFFE. Thank you, sir. May I just leave something else for you! Gentlemen, this is a copy of one of the most progressive lifeinsurance policies issued today.

Senator Bush. You cannot sell any life insurance.

Mr. YAFFE. I am not trying to sell it to you, but just want to leave it there with you to see if you can wade through all of the exclusions and coverages and see if you can figure out what it means.

Senator BUSH. Thank you.
Mr. YAFFE. Thank you, sir.
Mr. EDELSTEIN. Mr. Irving Dichter.

STATEMENT OF IRVING DICHTER, EXECUTIVE BOARD MEMBER,

DISTRICT 6, INTERNATIONAL UNION OF MINE, MILL, AND SMELTER WORKERS

your time.

Mr. DICHTER. Senator Bush and representatives of Senator Lehman: We realize it is late and we are not going to take up too much of

Senator Bush. Won't you be seated, Mr. Dichter?
Mr. DICHTER. I will.

Our union happens to represent some thousands of brassworkers who unfortunately live right in the Naugatuck Valley. Perhaps of any single group our membership was hardest hit by this most recent flood. It was hit two ways, of course—through loss of their homes and property and through partial loss of their jobs.

These job losses have been temporary, but many of our people have been out of work for 10 or 11 or 12 weeks, and we still have some who are not yet back to work. From all indications some of our plants may not be operating at preflood level until January 1, so that our people took a beating at home, so to speak, and a beating on the job.

а. We come here specifically today to talk about flood insurance and some immediate grant on the part of the Federal Government to cover this retroactive aspect which you discussed with some of the previous witnesses before the committee.

I will read a short statement to the committee.

We appear here today to urge upon you the imperative necessity of recommending comprehensive flood-insurance legislation immediately upon the convening of the next session of Congress.

We too would like to have a special session, but by all indications there does not appear to be any likelihood of a special session between now and January on the matter of flood protection, but we feel immediately upon the reconvening of Congress this should become one of the major items for Congress to consider. We should like to have hearings on this, that is, regular congressional hearings, as early as possible, and would like to see the bill disposed of as early as possible.

Therefore we recommend a comprehensive flood-insurance bill immediately upon the convening of the next session of Congress.

We commend this committee for holding these hearings prior to Congress going into session, so that by the time Congress does convene perhaps you can have the bill prepared.

I want to make one more comment. I know, Senator Bush, you took exception to Senator Lehman's references to the fact that the administration did not as yet make any recommendations. Well, frankly, we would rather have a little bit of a clash between partisan groups on this issue, rather than have bipartisan apathy on the question. If both of you are most anxious to get a bill before the people, we are delighted. We are going to judge everybody on the basis of what he does on this particular issue.

Hundreds of our members living in the Naugatuck Valley, in the cities of Torrington, Thomaston, Seymour, Ansonia, Derby, and

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Stamford, lost their homes and all of their possessions in the recent floods. We have representatives here from all of these towns. They are members of our local unions. Many hundreds more, whose homes withstood the ravages of the floods, lost all of their household possessions. In spite of the splendid assistance rendered by the Red Cross, these people today are at a loss, wondering how they are going to reestablish their homes again. They do not have the resources available to the larger corporations.

A man who owns a $12,000 to $15,000 home just cannot do what the New Haven Railroad does. He just cannot go out and float a $10 million loan. He has difficulty enough getting a $500 loan. Their possessions represented literally a lifetime of difficult accumulation. It is a refrigerator 1 year and a washing machine perhaps 3 years later. All of these possessions just went in the flood.

These people are in no need of sympathy. Everyone has given them plenty of that. They want some assurance that they can return to their former homes or homesites, and have some degree of protection against recurring disasters. They also want to see ('ongress, which can be so generous in rendering assistance all over the world, provide some form of outright grants to those who suffered so grievously in the recent floods.

We therefore recommend to this committee for action by Congress:

(1) The establishment of a Federal Disaster Insurance Corporation which would provide 100 percent insurance against damage caused by floods, wind, rains, and tides. The Federal Government has considerable experience in the insurance field and there is no need to think in terms of subsidizing the private insurance companies to develop this kind of coverage. Perhaps if the Government took the risk for flood insurance it might impel it to move more rapidly on a comprehensive flood-control program.

If we want flood insurance, I am not too worried about who is going to sell it. The people in the valley are going to buy it. They have been hard hit. If the post oflice posted a notice that said flood insurance is available here, come and get it, the people will come and get it. Frankly, we are not interested in the details as to whether the private insurance companies are going to sell it or whether the insurance agents will. As a matter of fact, our recommendation is we make it most easily available. If we have a Federal Flood Insurance Corporation, then through the operations of the post office, and we have one in every town, this type of insurance can be sold.

It has to be on a reasonable basis. We cannot have too high a premium. I recall there was some talk previously of a 10-percent premium. That is out of the question for a poor guy who owns a $12,000 home. He cannot afford $1,200 a year worth of insurance. He has to have the type of insurance that would be comparable to fire insurance, which he carries at the present time, which is reasonable, and which is the kind that he can afford. Anything beyond that is just out of his ken, and he will not buy any insurance which is prohibitive because he cannot afford it. He has to pay a mortgage and pay the interest on it.

If necessary, the Government can subsidize that type of insurance operation.

(2) That Congress allocate sufficient funds for outright grants to those who lost their homes and possessions in the last two floods.

These grants could be administered by one of the disaster agencies of the Government and would do more than anything else to put our people on their feet again.

The question was raised as to how far should we develop retroactivity. We do not have to. You are going to kill this aspect of a grant if

you will think in terms of 1951 and 1952 and 1947 and 1948. What happened that many years ago is most unfortunate, but the problem we face today is a tremendous catastrophe throughout New England. We have to render some assistance to the people involved. This may be unfair to the people who were involved in 1951, or in floods in previous years, but that is most unfortunate.

The point is if we begin to think in terms of how many years ago we are going to go back, then nothing will happen. Our recommendation is that we make a grant this year and forget about what happened to the people in 1951 or 1952, or in previous years, not because we want to deny them anything but because we recognize that once you start on that path you are getting nowhere.

We recognize that the above two recommendations are not the entire solution to the flood problem. We have, together with the rest of the labor movement and many community and business organizations, proposed a comprehensive flood relief and prevention program. We are attaching it to this statement for your information.

I want briefly to state it involves such things as dredging and widening the Naugatuck River, which the merchants of all our towns have clamored for and had a picket line out in front of the city hall when the Governor was there last. Also, the construction of a series of multipurpose dams to control rainfall

and to provide us, if at all possible, with cheaper electricity. Also Federal food insurance, which I already discussed.

We also propose immediate construction of low-cost housing to be made available to all flood victims. This housing is to be a subsidized form of housing similar to the Bowles program, wherein a man could get a house at a very low rate of interest and could move in without carrying a tremendous burden on his shoulders.

Of course, we have recommendations for the Senator, but there is no point in going into them here and now. In essence, this is our program.

Our feeling also is, where there is a will there is a way. In collective bargaining we many, many times first determine our needs and then find out how the companies are going to buy it or pay for it. And so it is here. If there is a will and if there is a determination that this has to be done, then it is going to be done. It does not have to be the perfect plan. Let us not worry about the fact that the first Federal flood-insurance program is going to cross all the t's and dot all of the i's. We will have to learn as we go along, but let us get started and into operation.

We pray that there will not be any more floods in the Naugatuck Valley, but there may very well be other floods of the same type in other parts of the country. We do not want to see people in any part of our country suffer floods like the people in our valley did. It is an overwhelming disaster.

I visited one of our flood towns the day after and our people were shellshocked. When I asked them what they needed they did not know. As a matter of fact, most of them said, "We do not need

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anything," when their houses were gone and their jobs were gone and the bridges were down. They were simply so overwhelmed by this great destruction and great tragedy that they did not know where they were.

We therefore very, very strongly, representing the group which perhaps was hardest hit in the State of Connecticut-very strongly urge upon you the establishment of this Federal Flood Insurance Corporation for a subsidized insurance program and an immediate grant by this committee of the Senate for the people who suffered so grievously in the last two floods.

Senator Bush. Thank you very much, Mr. Dichter. The committee is very grateful to you for coming here and giving us your views about this. Mr. DICHTER. Thank

you,

sir. Senator Bush. Without objection, the prepared statement of Mr. Dichter will be made a part of the record at this point.

(The prepared statement follows:)

STATEMENT OF IRVING DICHTER, EXECUTIVE BOARD MEMBER, DISTRICT 6, INTERNA

TIONAL UNION OF MINE, MILL, AND SMELTER WORKERS We appear here today to urge upon you the imperative necessity of recommending comprehensive flood-insurance legislation immediately upon the convening of the next session of Congress.

Hundreds of our members living in the Naugatuck Valley, in the cities of Torrington, Thomaston, Seymour, Ansonia, Derby, and Stamford lost their homes and all of their possessions in the recent floods. Many hundreds more whose homes withstood the ravages of the floods lost all of their household possessions. In spite of the splendid assistance rendered by the Red Cross, these people today are at a loss wondering how they are going to reestablish their homes again. They do not have the resources available to the larger corporations. Their possessions represented a lifetime of difficult accumulation.

These people are in no need of sympathy. Everyone has given them plenty of that. They want some assurance that they can return to their former homes or homesites, and have some degree of protection against recurring disasters. They also want to see Congress, which can be so generous in rendering assistance all over the world, provide some form of outright grants to those who suffered so grievously in the recent floods.

We therefore recommend to this committee for action by Congress :

(1) The establishment of a Federal Disaster Insurance Corporation which would provide 100 percent insurance against damage caused by floods, wind. rains, and tides. The Federal Government has considerable experience in the insurance field and there is no need to think in terms of subsidizing the private insurance companies to develop this kind of coverage. Perbaps, if the Govern. ment took the risk for flood insurance it might impel it to move more rapidly on a comprehensive flood-control program.

(2) That Congress allocate sufficient funds for outright grants to those who lost their homes and possesions in the last two floods. These grants could be administered by one of the disaster agencies of the Government and would do more than anything else to put our people on their feet again.

We recognize that the above two recommendations are not the entire solution to the flood problem. We have, together with the rest of the labor movement and many community and ss organizations proposed a comprehensive flood relief and prevention program. We are attaching it to this statement for your information.

MINE, MILL FLOOD RELIEF AND PREVENTION PROGRAM 1. Federal

(a) Dredge and widen Naugatuck River. (6) Construction of a series of dams to control flow during heavy rainfalls. (c) Federal flood insurance.

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