Texas expecting Katrina-like wind v water litigation after Ike

Sop’s great new link to Insurance Law Hawaii brings legal issues full circle from Katrina to Ike with Is damage from Ike caused by flood or wind.

The battle has begun on whether the Hurricane Ike’s damage to the Texas coast was a result of flood or wind…Since the storm, Texas legislators have suggested that the Texas Windstorm Insurance Association pay claims for damages resulting from storm surge.  This Association has taken on coverage for many coastal homeowners after private insurers withdrew from the market…The Fifth Circuit, which includes Texas, has developed a body of law on the flood/wind dichotomy in homeowners’ policies.  Although it would seem many of the issues decided after Hurricane Katrina would apply to coverage issues after Hurricane Ike, it will be interesting to follow how the litigation develops.

Everyone but Ike knows you don’t mess with Texas, and, the Texas Monthly has its eye on the slabbed according to the post linked to ILH.

Texas Watch today wrote coastal and Harris County legislators and members of the appropriate legislative committees asking lawmakers to consider a proposal by state Senator Rodney Ellis to “explicitly direct insurers to cover storm surge losses.”

This [correspondence] came after the Texas Windstorm Insurance Association (TWIA) annnounced earlier today that it would not pay claims for damages resulting from storm surge. Calling this position “ludicrous,” Texas Watch makes the point that “storm surge is a phenomenon peculiar to windstorms.” (emphasis added) Continue reading “Texas expecting Katrina-like wind v water litigation after Ike”

Patti Labelle sings HR3121 theme to "Sammy the DC Bookie"

Sam Friedman’s post inspired this post in support of HR3121. Take a listen and see if you don’t understand why it’s the voter’s choice of all the various legislation pending in Congress.

What is America to me

A name, a map, or a flag I see
A certain word, democracy
What is America to me

The house I live in Continue reading “Patti Labelle sings HR3121 theme to "Sammy the DC Bookie"”

Just what is there not to like about HR3121?

While I was looking for a map to respond to a comment from Beau, I googled up a HR3121 for dummies prepared by a NAIC committee – it appears the purpose was a briefing document to use when considering support.

Before you peek, I’ll go ahead and tell you that it makes a pretty long post – but I like the legislation  even better after seeing some things that I probably didn’t think were all that important before.

If it repeats something we’ve already posted, I hope Sop will hit the delete and the rest of you will forget I put it up.  Otherwise, take a look and let us know what you think.

Section 1 – Title

Flood Insurance Reform and Modernization Act of 2007. Continue reading “Just what is there not to like about HR3121?”

NFIP catch-all: next vote, more lobbying, another approach

When the Senate returns tomorrow, the wind-less extension of the federal flood insurance program is expected to come up for a vote, according to information posted by slabbed reader cominglatersooner.

Most of the amendments proposed by Gulf Coast lawmakers to minimize rate increases for their constituents and increase coverage limits failed in votes last week. But Sen. Mary Landrieu, D-La., said she got word that one of her proposals will be accepted in a modified Continue reading “NFIP catch-all: next vote, more lobbying, another approach”

Idealogy defeating reason

Since becoming Sop’s partner on slabbed, it’s been a continuing challenge to apply my background in health insurance to the post-Katrina issues of property insurance. Being uninsured can be hazardous to your health lightened my load today.

...insurance is not just a luxury. It can be a matter of life and death.

While a lack of health insurance can literally be a matter of life and death, the meaning can be both literal and figurative when applied to property issues of property insurance – evident in the survey data collected in Ocean Springs as well as in the increase in suicides on the Coast – an increase similar to that I suspect will also surface in violent death rates and/or incidence of physical violence.

A better understanding of the interrelated nature of physical health and financial health – and the differences in the way these two different systems of insurance function – is fundamental to a solution for the current health care financing crisis and the growing crisis in the property insurance industry. Continue reading “Idealogy defeating reason”

Subsidy for Dummies (who think the insurance industry isn’t subsidized)

When the opposition to HR3121 started talking nasty-nice about the subsidy for wind damage, I knew it was time to write Subsidy for Dummies (who think the insurance industry isn’t subsidized).

You see, those most likely to oppose HR3121 are also likely to already benefit from various government subsidies as much, if not more, than others as tax breaks are the most common form of government subsidy – monetary support the government provides to individuals or enterprises when such support is deemed to be in the public interest.

Consequently, a tax break for whatever purpose – even one for sending your kids to college – is a subsidy and so is the fee paid to insurance companies for the cost of processing claims payable from the National Flood Insurance Program. Continue reading “Subsidy for Dummies (who think the insurance industry isn’t subsidized)”

The “F” word is back in the news!

Rebecca Mobwray tells the storyFEMA to restructure the way it pays private insurers – but there’s another story in the story – the Federal Flood Insurance Program provides a subsidy to private insurers!

I know, I know – I’ve got the “F” word and the “S” word in the same post but I haven’t finished “Subsidy for Dummies” and the insurance industry has opposed HR3121 because it would “socialize a currently private industry…Taylor’s best efforts notwithstanding, everyone sees his bill for the giant subsidy package that it really is. No one beyond those who stand to personally benefit has an appetite for that.”

…and, who benefits?

In addition to paying insurance companies fees on a sliding scale to cover the cost of sending adjusters to individual homes, FEMA also pays insurance companies a flat 3.3 percent of the cost of claims to cover overhead expenses that are not associated with specific claims, such as the cost of maintaining a field office.

While insurance companies were paid 3.3 percent of the value of claims in overhead, adjusting those claims only cost them 2.5 percent of the value of the claims, according to data the insurance companies collected for the flood program.

Now, doesn’t that make you want to say the “F” word, too?

Link to the Story: htcls : )

Pick your peril!

The words actuarially sound would not be popping up on an increasingly frequent basis if the passage of HR3121 had not become a very real possibility – as well it should.

Folks on the Coast are not the only ones facing a housing crisis – just likely the only ones facing foreclosure without out a house!

As a construction specialized CPA, Sop is far more qualified to explain the housing crisis on the Coast by those numbers. So, let’s talk about the crisis here in different terms.

An adequate supply of affordable housing is the engine of economic and community development because the built community is the infrastructure of the social community. Continue reading “Pick your peril!”

Senate passes Resolution supporting HR3121

More insurance news, Sop – Senator Gollott had 21 co-sponsors for his Resolution.

Senate Concurrent Resolution 527, authored by Sen. Tommy Gollott, R-Biloxi, urges Congress to adopt the bill that is pending before the Senate, which would extend the National Flood Insurance Program to include wind damage and other coverage. Taylor has been pushing the plan hard.

Gollott pointed to the slow recovery in the hard hit areas of South Mississippi where private sector insurance troubles have slowed rebuilding as proof government issued multi-perils coverage is needed.

“I’m really going to push this because we direly need it on the Coast,” Gollott said.

Gollott said he plans to send the resolution to officials in every state, as well as every member of the U.S. Senate.

Read the full story here and the Resolution here.