Summit Aimed At Creating National Catastrophe Insurance Program
CONTACT: Beth Scott
SAN FRANCISCO –After a season of devastating hurricanes, four state insurance regulators are meeting Tuesday and Wednesday to devise a national catastrophe insurance program. "The current system of financing catastrophe losses after the fact is not working," said Florida Insurance Commissioner Kevin McCarty. "We need a comprehensive federal solution that pre-funds catastrophic losses, not funding after the event using the federal deficit."
The Summit is hosted by McCarty, New York State Superintendent of Insurance Howard Mills, Illinois Director of Insurance Michael T. McRaith and California Insurance Commissioner John Garamendi. Participants include AIR Worldwide, RMS, and Eqecat, the Brookings Institution, the Florida Hurricane Catastrophe Fund and the California Earthquake Authority. Recent catastrophes have added urgency to the mission of the Summit. "We have repeatedly seen evidence that the financial consequences of these catastrophes cannot effectively be dealt with by existing insurance policies or federal emergency aid," said California Insurance Commissioner Garamendi. "One policy, national in scope, will be a more effective and affordable way to provide for those financially harmed by disasters and acts of terrorism."
McRaith said the talks are key to devising a rational approach to disaster response: "On behalf of Gov. Blagojevich, I welcome this discussion that will prioritize consumer and taxpayer interests, integrate responsible business models, and more clearly define private and public sector roles."
New York's Mills agreed. "It is imperative that we plan ahead in order to be in a position to respond nationally to the financial consequences of major catastrophes, accumulating funds in both the private and public sectors to pay for extraordinary losses. This summit gives insurance regulators, the industry and legislators an opportunity to begin a dialogue that will move us closer to that public policy goal."
Regulators plan to establish the framework for a program by the end of the meeting on Wednesday. Other participants in the Summit include commissioners from Alabama, District of Columbia, Pennsylvania, Washington, Utah and North Dakota. Key regulatory representatives from Virginia, Arkansas, New Jersey, Maryland, Massachusetts and Nevada plan to attend.
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