WASHINGTON (Aug. 1, 2007) – The National Association of Mutual Insurance Companies today commended the Senate Banking Committee for approving the Commission on Natural Catastrophe Risk Management and Insurance Act of 2007. The legislation would establish a bi-partisan commission to examine the risks and recommend possible solutions for Americans living in natural disaster-prone areas.
“Many of the problems faced by residents of the Gulf regions after the 2005 hurricane season might have been prevented if strategies had been in place beforehand,” said Justin Roth, NAMIC’s senior federal affairs director. “It is our sincere hope that Congress will adopt this legislation and allow a panel of experts to develop practical solutions to the issues confronting homeowners in areas vulnerable to natural disasters.”
NAMIC praised committee Chairman Christopher Dodd, D-Conn., for including in the legislation two key issues for the commission to examine: the impact of stronger building codes and the effect that rate regulation has on catastrophe insurance. “NAMIC has continued to fight for stronger state-wide building codes as a way to decrease losses for homeowners,” Roth said
One of the major causes of the availability and affordability problems facing homeowners in coastal markets is states’ refusal to allow insurance companies to charge actuarially sound rates, Roth explained. “The inability of carriers to charge appropriate rates in states such as Florida has resulted in many insurance companies refusing to write homeowners coverage there,” he said. “Reducing the number of companies that write insurance reduces competition in those states and leads to higher costs for consumers. We are pleased that committee Chairman Dodd has asked the commission to look into this problem.”
The legislation now goes to the full Senate for consideration. “The commission is key to the nation’s ability to respond appropriately to future natural disasters and ensure human suffering and property losses are kept to a minimum,” Roth said. “Allowing representation from a variety of vantage points, including the insurance industry, will help this panel formulate solutions that address all the needs of homeowners in the most risk-prone areas of the country.”
For further information, contact
(202) 628-1558 Tel
(202) 628-1601 Fax
Posted: Wednesday, August 01, 2007 12:00:00 AM. Modified: Wednesday, August 01, 2007 1:56:59 PM.
317.875.5250 - Indianapolis | 202.628.1558 - Washington, D.C.