His letter calls for the committee to investigate what he calls "the denial of claims wherever insurers could blame flooding" and "excessive premium increases, market withdrawals and other actions to force states to make concessions or assume more coastal risks."

Rep. Taylor noted in the letter that Sen. Trent Lott, R-Miss., whose home was destroyed by Katrina, secured language mandating a Government Accountability Office study of claims adjustment of wind and water claims relating to Hurricane Katrina passed as part of a Homeland Security Appropriations bill. The report is required to be delivered to Congress by April 1.

"I ask that you not wait until then to begin the committee's investigation," Rep. Taylor wrote. "It is clear that the insurance companies have a conflict of interest when allowed to assign damages to the federal flood program rather than to themselves."

Rep. Taylor also said in the letter that he plans to introduce legislation repealing the industry's anti-trust exemption under the McCarran-Ferguson Act.

"The insurance industry's actions in Mississippi provide ample evidence of widespread anti-competitive behavior that should be illegal," he said. "Those actions also provide proof that a small state such as Mississippi is not capable of regulating the industry."

At the state level, insurers are taking exception to comments made by Mississippi Attorney General Jim Hood in the wake of the $2.7 million verdict against State Farm.

After the verdict was announced, Mr. Hood said he was not surprised by the ruling, which he characterized as a fair interpretation of the law. He added that he would be willing to work with companies on future disputes, adding, however, that "if they continue with their 'robber baron' mentality, I think that Congressmen Taylor and [Bennie] Thompson [D-Miss] and Senator Lott will see to it that we have national insurance reform."

Joseph Annotti, a spokesman for the Property Casualty Insurers Association of America, said that Mr. Hood's "over-the-top rhetoric and name calling is counterproductive" to the Mississippi rebuilding effort.

Mr. Annotti said the magnitude of the destruction brought by Hurricane Katrina "has made it very difficult to answer regarding the exact cause of the damage in a small percentage of cases."

Insurers contend that policy flood exclusion language bars payment even if hurricane wind damage is involved.

Mr. Annotti said the latest State Farm ruling was not based on the wind versus water issue, but rather the company's inability in this instance to prove that flooding was at the root of the damages.

"It is important that the courts look at the merits of each case individually and rule based on the language of the contract," he said. "A fair and balanced approach to the law is essential if there is to be any predictability and certainty regarding the meaning of a contact. Name calling and threats of regulatory retaliation aren't in anyone's best interest--consumers, companies, or public policymakers."