Please attribute to NAMIC President/CEO Charles M. Chamness
INDIANAPOLIS (April 17, 2006)—The National Association of Mutual Insurance Companies (NAMIC) issues the following statement in response to comments made by Mississippi Attorney General Jim Hood at a luncheon sponsored by the Capitol press corps and Mississippi State University's John C. Stennis Institute of Government, held Thursday. During his comments Hood compared the insurance industry to “Nazis.”
“Now that Mr. Hood's inspired exercise in justice has met some resistance, his public rhetoric seems to get more hysterical and irresponsible. Initially he said the existence of flood exclusions in insurance contracts was ‘unconscionable’; last week a judge ruled that flood exclusions are valid and legally enforceable, so Mr. Hood has upped the ante by calling insurers ‘Nazis.’
“The fact remains that no private insurer ever collected a dime for flood coverage. Mr. Hood would force them to pay flood claims anyway in direct contravention of the principles of risk sharing and underwriting on which the property-casualty industry is built. One wonders what other industries Mr. Hood will sue for failing to provide goods or services to people who didn’t buy them.
“Mr. Hood’s gambit could be economically disastrous for Mississippians. If insurers must pay claims for losses their policies didn’t cover, they will be forced top raise premiums to cover every conceivable peril, irrespective of whether it’s excluded in the contract. That could make homeowners insurance—and thus homeownership itself—unaffordable for many citizens of Mississippi.
“While nothing could stop the destructive force of Hurricane Katrina, the Mississippi courts can prevent another major catastrophe by rejecting Mr. Hood’s audacious assault on insurance contracts.”
For further information, contact
Rick Nelson, NAMIC
(317) 875-5250 Tel
(317) 879-8408 Fax