NEW YORK (Bloomberg) — US property-casualty insurers have asked lawmakers to keep rival financial companies from tapping federal aid to gain competitive advantage.

The Treasury Department's $700 billion financial industry bailout package may present "a substantial risk of market distortion", Marc Racicot, president of Washington-based American Insurance Association, said in a letter to House Financial Services Chairman Barney Frank and other lawmakers. US funds may be used for "unintended purposes such as gaining market share", Racicot said. Property-casualty managers, led by the chief executive officers of Travelers Cos. and Ace Ltd., are stepping up their efforts to minimize government involvement as their life insurance counterparts line up for aid. Hartford Financial Services Group Inc., which sells life insurance as well as property coverage, is seeking as much as $3.4 billion in federal funds after investment losses.

Most property-casualty companies won't seek capital from the government, AIA said on October 27.

The letter was distributed by AIA spokesman Blain Rethmeier in an e-mail release.