Senate Bill sb1676

    Florida Senate - 2006                                  SM 1676

    By Senator Garcia





    40-1193-06                                          See HM 541

  1                         Senate Memorial

  2         A memorial to the Congress of the United States

  3         urging Congress to support a National

  4         Catastrophe Insurance Program.

  5  

  6         WHEREAS, during the 2004 and 2005 hurricane seasons,

  7  the State of Florida was devastated by eight hurricanes and

  8  four tropical storms, causing approximately $35 billion in

  9  estimated gross probable insurance losses, and

10         WHEREAS, the hurricanes from the 2004 and 2005

11  hurricane seasons have produced high winds, coastal storm

12  surges, torrential rainfalls, and flooding resulting in

13  significant damage to Florida and the Gulf Coast states, which

14  has resulted in displacement of policyholders from their

15  dwellings, loss of personal belongings and contents, closing

16  of businesses and financial institutions, and temporary loss

17  of employment and has created numerous health and safety

18  issues within our local communities, and

19         WHEREAS, in 1992, Hurricane Andrew resulted in

20  approximately $20.8 billion in insured losses and was

21  previously the costliest catastrophe in the United States, but

22  Hurricane Katrina alone left the Gulf Coast states with an

23  estimated loss of approximately $35 billion, and

24         WHEREAS, natural disasters continually threaten

25  communities across the United States with extreme weather

26  conditions that pose an immediate danger to the lives,

27  property, and security of the residents of those communities,

28  and

29         WHEREAS, the insurance industry, state officials, and

30  consumer groups have been striving to develop solutions to

31  insure mega-catastrophic risks, because hurricanes,

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    Florida Senate - 2006                                  SM 1676
    40-1193-06                                          See HM 541




 1  earthquakes, tornadoes, typhoons, floods, wildfires, ice

 2  storms, and other natural catastrophes continue to affect

 3  policyholders across the United States, and

 4         WHEREAS, on November 16 and 17, 2005, insurance

 5  commissioners from Florida, California, Illinois, and New York

 6  convened a summit to devise a national catastrophe insurance

 7  plan which would more effectively spread insurance risks and

 8  help mitigate the tremendous financial damage survivors

 9  contend with following such catastrophes, NOW, THEREFORE,

10  

11  Be It Resolved by the Legislature of the State of Florida:

12  

13         That the Congress of the United States is urged to

14  support a National Catastrophe Insurance Program.

15  Policyholders require a rational insurance mechanism for

16  responding to the economic losses resulting from catastrophic

17  events. The risk of catastrophes must be addressed through a

18  public-private partnership involving individuals, private

19  industry, local and state governments, and the Federal

20  Government. A national catastrophe insurance program is

21  necessary to promote personal responsibility among

22  policyholders; support strong building codes, development

23  plans, and other mitigation tools; maximize the risk-bearing

24  capacity of the private markets; and provide quantifiable risk

25  management through the Federal Government. The program should

26  encompass:

27         (1)  Providing consumers with a private market

28  residential insurance program that provides all-perils

29  protection.

30         (2)  Promoting personal responsibility through

31  mitigation; promoting the retrofitting of existing housing

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    Florida Senate - 2006                                  SM 1676
    40-1193-06                                          See HM 541




 1  stock; and providing individuals with the ability to manage

 2  their own disaster savings accounts that, similar to health

 3  savings accounts, accumulate on a tax-advantaged basis for the

 4  purpose of paying for mitigation enhancements and catastrophic

 5  losses.

 6         (3)  Creating tax-deferred insurance company

 7  catastrophe reserves to benefit policyholders. These

 8  tax-deferred reserves would build up over time and only be

 9  eligible to be used to pay for future catastrophic losses.

10         (4)  Enhancing local and state government's role in

11  establishing and maintaining effective building codes,

12  mitigation education, and land use management; promoting state

13  emergency management, preparedness, and response; and creating

14  state or multistate regional catastrophic risk financing

15  mechanisms such as the Florida Hurricane Catastrophe Fund.

16         (5)  Creating a national catastrophe financing

17  mechanism that would provide a quantifiable level of risk

18  management and financing for mega-catastrophes; maximizing the

19  risk-bearing capacity of the private markets; and allowing for

20  aggregate risk pooling of natural disasters funded through

21  sound risk-based premiums paid in correct proportion by all

22  policyholders in the United States.

23         BE IT FURTHER RESOLVED that copies of this memorial be

24  dispatched to the President of the United States, to the

25  President of the United States Senate, to the Speaker of the

26  United States House of Representatives, and to each member of

27  the Florida delegation to the United States Congress.

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