Fla. Pols Ready to Lead Lobbying Effort for National Catastrophe Fund

January 29, 2007

  • January 29, 2007 at 10:12 am
    broadcast news says:
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    a bunch of legislators that just passed a massive government subsidy plan without coming up with any way to pay for it all? Strikes me that Florida is living proof of how not to go about making good public policy.

  • January 29, 2007 at 2:24 am
    sam says:
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    It surely will be a hard sell for those states that are not prone to flooding, earthquakes and those non-covered perils. I live in WI and have a minute chance of a hurricane striking here. I have purchased flood insurance in the chance of flood, but that is more for backup problems than a river rising over banks or levees. Why should the midwest fund the east coast, gulf coast & west coast for their increased liklihood of suffering a catstrophic loss? I say I should not have to, and would make sure my legislators know that!

  • January 29, 2007 at 2:39 am
    Hoosier says:
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    I look forward to paying more taxes so people who unwisely build on sand can pay less for their insurance.

    I especially like to do this since, other than citrus products, this state produces nothing of any value and forbids any sort of natural resource removal such as Oil and Gas.

    These pandering spineless sheep are why the country is in the shape it is today. If you want to live in a hurricane prone area you should always pay more for insurance than those that choose not to.

    The irony is that Indiana incurred a 1.7 billion dollar hail storm last year and no one runs asking for federal relief or more regulation and artificial rate supression. The marketplace handled the issue through pricing and deductible adjustments.

  • January 29, 2007 at 2:48 am
    M Harcourt says:
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    Enact a 10 mile coastal ban and I might even support this. Anyone that chooses to build or buy within 10 miles of the ocean or gulf should foot the bill for this extravagance.

    For this inland people this would provide a backstop mechanism and with a 10 mile buffer would prevent losses anywhere near the magnitude of the last couple of years.

  • January 29, 2007 at 3:44 am
    Jeff says:
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    I hear a lot of concern about paying for people that live in FL or other area prone to natural disaster. If we did have a national disaster / catastrophe fund, it would make sense to charge somewhat on exposure. For example, you maybe wouldn\’t pay as much for flood coverage in Muncie, IN as you would in Miami, FL.

    With regard to \”paying for someone else\”. We all pay for everyone else. Let me give an example. Say you live in Indiana, and you are getting federal funds for highway work, schools, etc, that money doesn\’t only come from federal taxes collected in Indiana. California and New York for example pay more money into the federal tax system than they receive. Indiana receives more than is contributes.

    I don\’t think this means that New Yorkers should be upset with Indiana, it just works that way sometimes. There are state\’s rights and I think most certainly have a loyalty to their states, but we are one nation. I think all homeowners should be responsible to carry insurance for ALL perils regardless of region. And if you live in a state like mine (AZ) that doesn\’t really have natural disasters, take solace in the fact that you\’ll probably never have to try to rebuild your life after a flood, earthquake, etc.

  • January 30, 2007 at 8:21 am
    MD Insurance Lady says:
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    I don\’t feel that the fund should be set up as a free for all paid by taxes. It should be set up similar to NFIP, where one must buy into the policy in order to benefit. This will not only relieve those in Montana with little or no risk of a catastrophe, but will also require some financial responsibility for coverage to the policyholder/beneficiary.

  • January 30, 2007 at 11:12 am
    lower my (FEMA) taxes!! says:
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    I agreee with Jeff and MD Insurance Lady. Let\’s get everyone to pay for their risks based on location. If you have a National Cat Program, setup like NFIP, everyone will buy coverage and pay for their relative risk. Californians will pay very high premiums for E/Q coverage, but not Hurricane while Floridians will pay very high premiums for Hurricane, but not E/Q. I too am in AZ, so my National Cat premiums will be relatively low–how about less than $50/year. I do not think $50 is going to break me. If it is mandatory, there will be no further need for FEMA–talk about the tax payer paying for the un-insured!!

  • January 30, 2007 at 1:00 am
    pipe dreamer says:
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    I think we all know that your $50 a year is a pipe dream. The reason these politicians from Florida are creating a national cat pool has nothing to do with availability and the set up of a NFIP type pool. The issue is that Floridians cant \”afford\” there insurance premiums.
    They are not looking for anything that even remotely approaches an actuairly sound program.

    This means they are looking for the non cat prone areas to subidize them. Plain and simple but, of course, it will be presented as a way of softening cat risk for all Americans when in fact only a select group that choose to live in wind zones and eq zones will benefit.

    It would be much more palatable if they just came out and said that they need to get elected so they are appeasing their constituents at the cost of increased taxes for all Americans than the tripe they will come up with.

  • January 30, 2007 at 1:40 am
    Jeff says:
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    Pipe,

    That\’s a fair enough analysis. I\’m sure that we\’re not looking at an actuarial sound device here. And this very well is a way for people in disaster prone areas to supplement their insurance needs with the help of the rest of us.

    But, who cares. When you put the backing of the whole of the US behind a project the individual contribution is almost negliable. I seriously doubt you would need to charge a substantial (and by that I mean not over $ 50 to $ 100 / homeowner) amount to cover the costs of the program. Probably even less than that.

    Certainly, other states would also benefit from the CAT funds (I believe Hoosier pointed out the CAT damage in IN last year that led the nation). Also, I wouldn\’t only use this fund. I think there needs to be strict code guidelines in wind areas that make homes less susceptible to wind damage. And of course, they would need to pay more (even if not accurarily adequate) for their coverage. In addition, to supplement the fund in states more prone, maybe tack on a 1/2% sales tax.

    There are many options other than pricing people out of the insurance market to provide affordable coverage to Floridians. I think it is very hard to think to yourself that you\’re paying for someone else to live, but as I pointed out in my last post, it\’s not only a one way street.



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