Drywall building material, also called wallboard, gypsum board and plasterboard, is made of a flat sheet of gypsum covered on both sides with a thin layer of cardboard. It goes by such brand names as Sheetrock, Tablaroca, Gyprock and ToughRock.

Rep. Melancon said in a statement, "Louisianans have worked hard to rebuild their homes and communities since Katrina. Sadly, many are now having their lives turned upside down all over again.

"Through no fault of their own, these families are learning that their homes–their biggest investment–may be unlivable and even hazardous to their health" because of the presence of tainted drywall.

He added, "I will continue working to find solutions to the defective Chinese drywall problem. The Drywall Victims Insurance Protection Act will give homeowners peace of mind that they won't lose their insurance while they repair homes affected by Chinese drywall."

Homeowners living in houses built using Chinese drywall from 2004-2007 have complained about health issues including eye and throat irritation and asthma exacerbation, and the homes themselves have experienced degradation and odors. The issue has been particularly acute in Louisiana, Florida and Virginia.

However, a report on Chinese drywall released last month conducted by multiple federal agencies was unable to determine the cause behind the health issues and physical degradation, although it mentioned finding levels of sulphur and strontium. Federal authorities are still looking into the matter.

Meanwhile, in Florida Citizens Property Insurance Corp., the state's insurer of last resort was recently forced to rescind a non-renewal notice it had given after news reports that the action was taken because of Chinese drywall.

John Kuczwanski, public information manager for Citizens, said the non-renewal was not because the house had Chinese drywall specifically, but rather because of the damage done to the home that could have led to a covered peril in the coming policy period.

Upon further inspection, Mr. Kuczwanski said, it was determined the damage had not progressed to a significant degree to cause concern. He said if a corroded outlet was sparking, or if a connection on a water pipe was about to leak, the insurer would require that the pending damage be mitigated before renewal. But he stated Citizens would never non-renew a home just because it contained Chinese drywall.

A claim filed in that same case was denied by Citizens, Mr. Kuczwanski said, because damage caused by Chinese drywall is considered a builder's defect, which is excluded under most homeowners policies.

Regarding Rep. Melancon's bill, Michael Barry, spokesman for the Insurance Information Institute, said insurance "is regulated at the state level, and any legislation affecting policyholders should originate in state houses, not Congress."

"My sense is the issue is only limited to very few states at this point, and I'm reluctant to speculate, but unless [the problem] gets beyond the states such as Louisiana, Florida and Virginia, my guess is it [the bill] would have a tough time winning widespread support," he said.

Greg LaCost assistant vice president and regional manager for the Property Casualty Insurers Association of America called the bill well intended but saw problems with it.

The measure, he said, "creates questions about the costs to the affected states and most importantly to consumers. Louisiana took a good step by creating a fund to help some of its citizens who are dealing with this issue."

He added that, " The federal government, due to the international nature of this issue, should consider a range of options that include helping to determine the actual cause of the problem, while not violating basic tenets of insurance practices."