Federal recovery czar Donald Powell says he plans to meet with St. Paul Travelers Companies Inc. about the company’s recent decision not to renew commercial property insurance policies in southern Louisiana.
During a meeting at The Times-Picayune of New Orleans, Powell said the scarcity of property insurance has joined levees and housing as the most prominent issued dogging the recovery effort from hurricanes Katrina and Rita.
Powell said he plans to meet Dec. 14 with St. Paul Travelers President Jay Fishman in Washington in hopes of having the company at least modify its plan to cancel all commercial property policies beginning in March as they come up for renewal in the New Orleans region and around Lafayette and Lake Charles.
“I am hopeful that Travelers will reconsider, and it would surprise me if they don’t reverse that decision to some extent,” Powell said.
Company spokeswoman Jennifer Wislocki, who confirmed the scheduled meeting, said the company is “putting any changes to our current underwriting strategy on hold” following meetings and conversations with public officials.
Powell said the availability of property insurance, particularly for small and midsize businesses and for homeowners, has become a severe problem for all Gulf Coast states and the eastern seaboard. But he discounted the idea of federal intervention.
The industry has stopped writing policies in the past in disaster areas, then returned after the risk is assessed, Powell said.
“That’s the marketplace at work,” he said.
Powell said he had discussed with the industry such safeguards as a federal backstop fund and federal tax credits to lure insurers back into the region.
St. Paul Travelers writes 7.3 percent of all commercial property insurance policies in Louisiana, Wislocki said. The company does not break down its market share by region, she said.
Information from: The Times-Picayune, www.timespicayune.com.
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