Discriminatory practices? I carry flood insurance because I deem myself reasonable and prudent. I live in the Midwest and should not have to subsidize any other area of the country for their failure to purchase proper coverage. However, if this new plan were to have lower rates for \’wind\’ coverage, I cannot purchase it because there is not any requirement for building more wind resistant structures. The wind exposure here comes from tornados, not hurricanes. According to the article, I cannot buy the wind coverage. I think that is discriminatory!
You\’ll have to pardon me if I scoff at the idea of the government charging truly Risk-based premiums. Who determines the correct premiums? The politicians?
I don\’t think I\’m the only person here who thinks that the so called \”Risk Based\” premiums will really reflect exposure to risk. They will probably be about as Risk-Based as the Citizens or FHCF rates.
The potential for marked consequences may be realized when those who have no real knowledge of the industry or coverages available think they can dictate procedure.
For those choosing to live in high risk areas especially those of the wind pool , coverage is available in the forms of NFIP flood and homeowners wind policies. Those who do not insure their residences and businesses against both the risk of wind AND flood in regions most likely affected, which are delta plains lying at or below sea level, knowingly assume the risk for potential damage.
Is it fair for those who gamble and lose the bet with mother nature to reap the same benefits of those who played it safe and purchase the proper polices?
The coverage is there, deciding to invest in it is a personal choice. Hindsight is always 20/20.
It\’s hard to expand upon what has already been said here.
If the government and states would allow true risk based pricing for the wind and flood exposures, a private insurer would already be writing the coverage. Trust me, where there is a dollar to be made somebody out there will try to make it.
Unfortunately neither the government or the states will allow true risk based pricing. The argument that we have to keep insurance affordable for all, is the underlining issue. Sure it would be nice to have reasonable premiums for everyone, but as soon as you try that then the people living in less disaster prone areas will be subsidizing those who live in higher disaster prone areas.
Bottom line… the flood coverage is there now for people who want to be adequately protected. Sure it\’s not cheap… but that is a cost associated with living along a river or coastline.
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There is no other way to look at this proposal other than a subsidy for those choosing to live in a high risk area.
NFIP premiums $2-3 billion annually
Katrina claims $22 billion
The choice is clear, do we want to subsidize?
Discriminatory practices? I carry flood insurance because I deem myself reasonable and prudent. I live in the Midwest and should not have to subsidize any other area of the country for their failure to purchase proper coverage. However, if this new plan were to have lower rates for \’wind\’ coverage, I cannot purchase it because there is not any requirement for building more wind resistant structures. The wind exposure here comes from tornados, not hurricanes. According to the article, I cannot buy the wind coverage. I think that is discriminatory!
Read the bill. Risk-based premiums, not subsidized premiums. Building standards would be appropriate to the local risks.
Would not require Dade County standards in Kansas.
The bill text is here:
http://insurancetransparencyproject.com/wp-content/uploads/2007/02/multiple-peril-insurance-act.pdf
Intelligent commentary about this article is here:
http://insurancetransparencyproject.com/2007/02/11/agents-welcome-windstorm-debate-insurers-warn-against-subsidies/
You\’ll have to pardon me if I scoff at the idea of the government charging truly Risk-based premiums. Who determines the correct premiums? The politicians?
I don\’t think I\’m the only person here who thinks that the so called \”Risk Based\” premiums will really reflect exposure to risk. They will probably be about as Risk-Based as the Citizens or FHCF rates.
What a Joke.
The potential for marked consequences may be realized when those who have no real knowledge of the industry or coverages available think they can dictate procedure.
For those choosing to live in high risk areas especially those of the wind pool , coverage is available in the forms of NFIP flood and homeowners wind policies. Those who do not insure their residences and businesses against both the risk of wind AND flood in regions most likely affected, which are delta plains lying at or below sea level, knowingly assume the risk for potential damage.
Is it fair for those who gamble and lose the bet with mother nature to reap the same benefits of those who played it safe and purchase the proper polices?
The coverage is there, deciding to invest in it is a personal choice. Hindsight is always 20/20.
It\’s hard to expand upon what has already been said here.
If the government and states would allow true risk based pricing for the wind and flood exposures, a private insurer would already be writing the coverage. Trust me, where there is a dollar to be made somebody out there will try to make it.
Unfortunately neither the government or the states will allow true risk based pricing. The argument that we have to keep insurance affordable for all, is the underlining issue. Sure it would be nice to have reasonable premiums for everyone, but as soon as you try that then the people living in less disaster prone areas will be subsidizing those who live in higher disaster prone areas.
Bottom line… the flood coverage is there now for people who want to be adequately protected. Sure it\’s not cheap… but that is a cost associated with living along a river or coastline.