Reform to the US federal flood insurance program to add wind damage cover is under fire as a costly impost that will lead to irrational development along coastal regions.

The House of Representatives has voted to overhaul the National Flood Insurance Program, prompted by the refusal of insurers to pay Hurricane Katrina claims on a technicality that excludes wind damage in home policies.

The National Flood Insurance Program, which subsidises insurers for offering cover in flood-prone regions, involves more than 5.4 million policies worth an estimated $US800 million ($891 million).

Opponents of the legislation, mainly insurers, say broadening the program to cover wind damage is unviable, as the program owes the Federal Government $US18 billion ($20 billion) due to a bailout following Katrina.

President George W Bush has warned he'll veto the legislation.

Insurers also say the program encourages building in known flood regions, despite amendments in 2004 that require residents to pay the actuarial costs of living in a risk-prone area if their house is flooded more than twice.