State Wind Pool Buys $815M in Reinsurance

Jackson County board member Mark Cumbest says Mississippi’s insurer of last resort has bought $815 million in reinsurance for the coming storm season.

Reinsurance – essentially insurance for insurers – is a major driver of policy premiums. It protects the Mississippi Windstorm Underwriting Association from debilitating claims, such as those created by Hurricane Katrina in 2005.

Cumbest tells The Mississippi Press the association isn’t releasing the exact cost to protect future negotiations with reinsurers, but paid $65 million to $75 million for the coverage.

The wind pool covers about 41,000 coastal Mississippi property owners who cannot buy coverage in the open market.

Last year, the board reported it paid $69 million for $815 million of coverage. In 2010, it paid $69 million for $750 million in coverage.