Donelon, Fellow Commissioners Tackle Coastal
Insurance Issues at Public Hearing
Released: September 25, 2007
Commissioner of Insurance Jim Donelon and state regulators
from Alabama, Florida, Mississippi, South Carolina, Arkansas
and the Virgin Islands participated in a forum yesterday on
the insurance issues affecting hurricane prone states.
The event, sponsored by the National Association of Insurance
Commissioners (NAIC), was held in Mobile, Alabama.
Donelon and his fellow commissioners
heard from insurance company and reinsurance representatives
along with members of
Congress who discussed their ideas to improve the availability
and affordability of insurance on the Gulf Coast. "We are
open to all solutions," said Commissioner Donelon. "We
hope these will come from the private sector but we will need
a federal solution as well."
Arkansas Commissioner Julie Benafield
Bowman said she was taking part in the forum because the "coastal
insurance issue is a national issue, not just an issue for
Ideas offered by private insurance companies included: the
adoption and enforcement of modern statewide building codes
nationwide as has been done in Louisiana; the modernization
of the federal flood insurance program; the establishment of
state catastrophe funds in disaster prone states in connection
with the creation of a federal backstop for those state cat
funds. Insurance company representatives said they face coastal
hurricane challenges from Texas to Maine.
Congressmen Jo Bonner of Alabama and Tim Mahoney of Florida
said lawmakers on Capitol Hill are working on possible solutions
through legislation that would include a voluntary federal and
state partnership where states would pool their catastrophic
risk and be eligible for low interest federal loans if disaster
losses exceeded private insurance or state cat fund capacity.
Donelon said he will continue his push for a federal catastrophe
fund and urge his fellow commissioners to hold future public
meetings to carry on with the discussion of ideas and solutions
for the insurance issues affecting the coastal states.