Very occasional in fact though Part 1 brought tears to the eyes of Mr CLS over at Yahoo ALL (and I bet he still has that old link) and remains one of our all time greatest finance posts considering Nowdy wrote it. That is not a knock on my partner-in-blog as much recognition that someone who was previously illiterate in high finance could “see-it” around the time we were 6 months old as a blog. This global insurance thing is a complicated critter.
There are people on the bottom of this critter who live here on Main Street. Included in that number are the insurance agents who live in our communities across the coast from Bar Harbor, Maine to Brownsville, Texas. A few years ago, at an insurance forum similar to the event held today at USM Gulf Coast, Congressman Taylor was heckled by an irate insurance agent who was forcibly removed from the building by security. Today during Q&A State Farm agent Elvis Gates told the panel he was behind their efforts 100% as he didn’t get paid on policies he didn’t sell. My own agent’s office mostly looks deserted during business hours. These days everyone is feeling the pain. Elvis seems like he is a sharp guy.
The marketplace demands a single solution in an all perils policy. With State Farm pulling out the NFIP after being caught with their hand in the taxpayer cookie jar agents like Mr Gates have been made a casualty along with the rate paying public in the communities where they live. My own personal observation is that Allstate agents are farther along the path to disillusionment after being sacrificed en mass during the evil reign of Ed Liddy. Our readers may remember ol’ Ed was brought in to right AIG during the financial implosion in 2008. Continue reading “My brother Darryl and my brother Darryl – and we’re all in this together Part Trois: The multiperil drumbeat continues. An occasional series.”
The forum’s title, Gulf Coast Insurance Forum: What’s Wrong with the Insurance Market Along the Gulf Coast and How Do We Fix It? pretty much says it all. It is being held next Wednesday, October 20 9:00 AM sharp at the Fleming Education Center Auditorium at USM Gulf Park in Long Beach.
According to the folks at Source Watch RAND Corp “ranked fifth in the latest survey of think tank media citations by FAIR (Fairness & Accuracy in Reporting)” and is considered centrist. IMHO their work in the area of insuring right tail catastrophes like hurricanes has been very good as they tackle the issues from a broader standpoint that is not found in the insurance industry’s bought and paid for university research from places like U Penn.
The panel includes folks in the trenches with this issue everyday in David Treutel, Gene Taylor and Steve Scalise. Senator Wicker will have his policy guy there as well. This forum is sponsored by the Gulf Coast Business Council, the regional voice of the Mississippi coast business community.
I’d like to issue a special invite to the Slabbed Nation and especially our friend Lynda in central Mississippi to come join me and party the day away cussin’ and discussin’ the very real problem of the dysfunctional coastal wind insurance market.
Now that State Farm’s fleecing of the NFIP has been laid bare for all to see predictably, like a spoiled brat, Ed Rust and his gang of thugs in Bloomington are picking up their toys and going home. Paige St John at the Herald Tribune has the story: (h/t to a reader)
State Farm Mutual confirmed Thursday that it will stop administering federal flood insurance policies this fall, leaving government officials to find a new home for 800,000 customers nationwide who bought their coverage through the company.
State Farm does not insure property against floods or storm surge. But it is the nation’s largest administrator of such policies written by the National Flood Insurance Program.
In exchange for administrative fees and commissions, State Farm writes federal flood policies and handles claims, including sending adjusters to homes to assess damage.
Predictably FEMA had no clue what was happening in the program they are supposed to be overseeing: Continue reading “State Farm announces it is leaving the National Flood Insurance Program. FEMA still asleep at the switch.”
I’ve been hanging onto Anita Lee’s story from June 27th (H/t Editilla for the ease in finding the link) on Insurance Commish Mike Chaney’s upcoming insurance forum for almost 2 weeks now trying to figure out how to make all the puzzle pieces fit. Puzzle pieces? Now our readers are confused too but perhaps not as temporarily disoriented as I was left after seeing the Commish that same weekend being interviewed by WLOX’s Dave Elliot late that Sunday night. It was only this week that I figured out the Mike Chaney dichotomy to the point where I can convey the man’s fundamental contradictions and the differences between Mike Chaney the politician and Mike Chaney the ideologue. I’ll begin with Mike Chaney the politician and his upcoming forum designed to coincide with the National Governor’s conference scheduled for later this month in Biloxi as we visit with Anita Lee and the Sun Herald:
A wide variety of measures aimed at improving the coastal insurance market will be explored at a multi-state insurance forum scheduled on the eve of the National Governor’s Association conference.
Mississippi Insurance Commissioner Mike Chaney expects key stakeholders at the conference, including insurance commissioners from coastal states, insurance industry representatives and mitigation specialists. Chaney also hopes Gov. Haley Barbour, who is on the agenda, will bring coastal governors with him.
“It’s top-notch,” said Joseph Ammerman, a spokesman for the Mississippi Insurance Department, the host of the two-day forum July 16 and 17 at IP Casino Resort. “We’ve got a great lineup of speakers. The commissioner has been telling everybody who has agreed to speak, ‘We want answers.’
“We want to come away from this conference with some strategies about how to make things better on the Coast. We’re looking for solutions.”
I’d submit Mr Chaney and MID isn’t looking too hard for answers because the speaker lineup, while impressive, does not include a single consumer advocate. Mr Chaney is an industry guy who evidently doesn’t see the need for a consumer perspective at his forums. Mike Chaney the pol is always quick to take credit for the state funds given the windpool by the legislature to reduce premiums and that is what left me confused. You see, Mike Chaney the ideologue doesn’t believe in insurance subsidies for consumers nor any solution that involves governmental involvement beyond providing a free government backstop to for profit insurers …at least according to the 14th draft of the National; Association of Insurance Commissioner’s whitepaper titled: Natural Catastrophe Risk: Creating a Comprehensive National Plan. I’ll start with the AM Best story on the whitepaper before we delve deeper into Mssrs. Chaney and Richardson’s dissent: Continue reading “The Commish sets up a “Stakeholder” Meeting. If he’d only invited all the stakeholders…..”
There is story in today’s Washington Post that includes a Team Obama trial balloon for FEMA director that reminded me of that famous bit of Yogism I used in the post title in that James Lee Witt, Bill Clinton’s FEMA director is being looked at closely for the post.
On the surface Witt would seem like a great choice as his resume is packed full of skins on the wall. For the slabbed however it represents no real change at all. In fact Witt coming back to FEMA would represent more of the revolving door and the inherent problems associated with it.
We first ran across Mr Witt in his association with Allstate front group Protecting America.org. It is there you can find a press release from last Thursday that predicts a federal backstop will soon pass now that Obama will soon be President:
Edward T. Collins, a national director of ProtectingAmerica.org, the nation’s largest coalition of first responders, emergency management professionals, small and large businesses and 20,000 individual members dedicated to improving America’s preparation and protection from massive natural catastrophes, today told the National Conference of Insurance Legislators (NCOIL) that the nation and the states are poised to create financial backstops that will address the looming threat of record-breaking disaster losses without relying on bailouts from the federal taxpayers.
‘Tremendous progress has been made at the state and national levels to create a system of pre-funded financial backstops that will rely on private insurance company contributions to replace the after-the-fact taxpayer bailouts that have followed major catastrophes like hurricanes Katrina, Rita, Wilma and Ike,’ Collins told the NCOIL Subcommittee on Natural Disaster Insurance Legislation meeting in Duck Key, Florida today.
I personally found it ironic NCOIL was meeting in such posh surroundings as Hawk’s Cay Resort on Duck Key given the current controversy about traveling in style and partying while asking for taxpayer handouts but as the Protecting America press release illustrates the memo has been slow to be passed around. Cynics would say of course this is just another brazen illustration of arrogance. In fact taking cynicism a step further I’ll note that while Hawk’s Cay Resort is renowned Continue reading “It’s Deja Vu All Over Again”
Using industry trade groups as his primary sources, Arthur Postal reports passage of the extension for the National Underwriter. Our readers will remember current AIA Prez Marc Racicot as former Montana GOP Governor and George W Bushie 2004 campaign manager.
The Senate approved legislation Saturday that includes a provision extending the authorization for the current National Flood Insurance Program until March 6, 2009…….
The House passed the same bill Thursday.
Some insurance industry trade groups voiced grudging support for the extension, although they said they had hoped Congress would have completed work on legislation that would have extended the program as well as reformed it by this time. Continue reading “NFIP Formally Extended Until March 6, 2009”
Anita Lee wrote this story that was featured on the front page of the Sunday Sun Herald including quotes from our own Brian Martin on the internal politics in the conference committee:
The problem of separating wind and water damage after a hurricane will not go away, U.S. Rep. Gene Taylor knows.
In fact, he has been educating his Texas counterparts on what they can expect from the insurance industry after Hurricane Ike. Sympathetic adjusters will handle flood claims for residents who have federal flood coverage, cutting checks quickly with assurances that wind claims will be investigated.
In the end, the private carrier – who adjusts both claims through an agreement with the National Flood Insurance Program – will offer policyholders nothing, or pennies on the dollar, for wind damage to properties also hit by tidal surge. Continue reading “A Look Behind the Politics of the NFIP Re-authorization: Big Problems that Need Big Solutions”
Dorothy: Now which way do we go?
Scarecrow: Pardon me, this way is a very nice way.
Dorothy: Who said that?
[Toto barks at scarecrow]
Dorothy: Don’t be silly, Toto. Scarecrows don’t talk.
Scarecrow: [points other way] It’s pleasant down that way, too.
Dorothy: That’s funny. Wasn’t he pointing the other way?
Scarecrow: [points both ways] Of course, some people do go both ways.
The push to reauthorize the National Flood Insurance Program (NFIP) is on and I’m feeling a little frisky. This particular post has been in the making since June (actually early March) much to my partner Nowdy’s occasional consternation with me for not helping others see it. However, the creativity it takes to author posts comes in streaks for me, especially when the subject matter is complicated. I can uncomplicate things a bit now with the help of the Scarecrow and a few others that were willing to stick their necks out as we journey to Oz.
Politics is about nuance Continue reading “Do We Really Want Actuarially Sound Insurance Rates? Let's Go Ask the Wizard”
As long as Jim writes them we’ll be linking them as our friends in central Mississippi show us they not only get it but also care.
Three years ago today, Mississippi was a far cry from what it is today – with many scars and, hopefully, some lessons learned When Hurricane Katrina slammed into the Mississippi Gulf Coast bearing a massive tidal surge and 125-mph winds on Aug. 29, 2005, the refrain had always been that nothing could be as bad as Camille.
Camille, which struck Aug. 17, 1969, was the benchmark by which all other American hurricanes were measured. Although not as powerful at landfall as Camille – one of only three Category 5 storms ever to hit U.S. shores – Katrina set a new benchmark.
Katrina’s 35-mile-wide eye, with hurricane winds extending 125 miles from the center, engulfed a much wider area from Alabama to Louisiana, and sustained impact 100 miles inland. Two-thirds of Mississippi was declared a disaster. It’s destruction far surpassed Camille’s $11 billion in today’s dollars, up to $81.2 billion so far. Continue reading “The Clarion Ledger Nails it Again for the Slabbed and the Coast”
I had a feeling the presidential candidates would narrow down the field from two to one for us slabbers on their own and John McCain has done the narrowing. The big business loving wing of the party may just cause me to leave the Senate race ballot blank too. I simply will not vote against my economic interests in 2008. Arthur Postal has the story for the National Underwriter:
Republican presumptive presidential candidate John McCain voiced opposition to a bill proposing a national risk pool for natural catastrophes, and a Florida Democratic congressman rebuked him for his comments.
The issue arose yesterday, when the Arizona senator, while traveling on his campaign bus in Florida, said while he sympathizes with homeowners battered by soaring insurance costs, he was not prepared to endorse a national risk pool as a way to bring those prices down. Continue reading “McCain Comes Out Against a Federal Multi Peril Solution: Slabbers Everywhere Unite for Obama!”