An editorial in the Clarion-Ledger delves into a knotty insurance issue: U.S. Sen. Roger Wicker, R-Miss., is looking in the right direction in seeking federal legislation to clarify wind vs. water issues in hurricane insurance. But his proposed legislation may not go far enough. Wicker's proposed bill would establish a formula to determine property losses caused by wind or by water in hurricanes, and the formula would apply only in cases where structures are left as slabs.
The wind-versus-water disputes led to lengthy lawsuits in Mississippi after Hurricane Katrina struck in 2005. As Wicker noted, after meeting with Southern insurance commissioners last week, including Mississippi's Mike Chaney and fellow members of the National Association of Insurance Commissioners, the awards from Katrina-related court cases over wind vs. water damages were inconsistent by insurers and for victims.
Wicker's proposal - the Consumer Option for an Alternative System to Allocate Losses (COASTAL Act) would provide consistency, which could bring more stability to the insurance marketplace and encourage companies to write in those regions.
The urgency for action is increasing. Extreme weather phenomena have greatly impacted the United States in recent years including floods and associated landslides, hurricanes and associated ocean surges, tornadoes, heat waves, droughts and forest fires….
September 6, 2005 -- Destroyed houses in Gulfport, Mississippi, where Hurricane Katrina caused extensive damage. FEMA/Mark Wolfe
No comments:
Post a Comment