In a speech to business leaders Tuesday at Town Hall Los Angeles, The Allstate Corporation Chairman, President and Chief Executive Officer Ed Liddy called for greater public and private sector dialogue toward protecting consumers in the wake of natural disaster, the abuse that exists in the lawsuit industry as well as the importance of asbestos and workers’ compensation reform.
The devastation of the tsunami destruction in Asia and east India, the wildfires that ravaged Southern California in 2003 and the Florida hurricanes demonstrate the devastation that can occur as a result of a natural disaster. Liddy warned that the current system is not prepared to handle the economic impact of a large natural disaster in California. He suggested that government and businesses work together to protect homeowners, only 14 percent of whom are covered by earthquake insurance.
“One recent model indicates damage from a repeat of the 1906 San Francisco earthquake would cost about $400 billion in economic losses,” Liddy said. “With only 14 percent of California homeowners armed with earthquake insurance, the concern grows. Uninsured consumers whose life savings are tied up in homes and businesses would potentially be left with nothing.”
In order to remedy the situation, Liddy called for a greater dialogue and sharing of resources among stakeholders including governments, banks and insurance providers. Liddy challenged other industries to become involved, and reiterated that, “our industry stands ready to do its part.”
Liddy also discussed the need for class action reform, and advocated using the momentum of recent federal and state government victories to abolish civil lawsuit abuse. One of his missions is “to dismantle a veritable lawsuit abuse industry that has imposed ever-increasing burdens on American businesses and consumers.”
Liddy’s speech concluded with the issue of asbestos and medical malpractice reforms. As many more American workers are expected to suffer from health issues caused by asbestos, he stressed the need to offer a fair solution to both victims and companies which reduce transaction costs, preserve resources and provide predictability to industries that eliminated the use of asbestos decades ago.
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