Insurers, Agents Urge Coastal Wind Policy from Texas to Maine

Travelers, Nationwide Mutual and two insurance producer organizations are supporting a plan they say will make private windstorm insurance more affordable and available in coastal areas.

The concept includes federally-regulated uniform windstorm coverage for coastal homes from Texas to Maine and a government reinsurance program for insurers.

Jay Fishman, Travelers chief executive officer, said Travelers is committed to finding a private market solution. “The comprehensive concept we are offering reflects input and ideas from across the industry, and is based on four pillars that, taken together, focus on facilitating the availability and affordability of private insurance for hurricane and tropical storm wind coverage along the Gulf and Atlantic coasts,” Fishman said.

Also supporting the four principles are Nationwide, the Independent Insurance Agents & Brokers of America and The Council of Insurance Agents and Brokers. The four pillars of the wind policy proposal are:

• A stable and consistent regulatory environment, with a uniform set of rules applied to named wind coverage for coastal zones from Texas to Maine. This portion of the homeowner policy would be regulated by a federal body, with the remainder still regulated by the states.
• Transparency in calculating insurance premiums, with risk-based, actuarially sound rates.
• Federal reinsurance for extreme events made available to insurers at cost so there would be no taxpayer subsidy.
• Encouraging stronger homes through federal guidelines for appropriate building codes and land use planning, with incentives for state and local adoption, plus enhanced construction technology and premium credits for customers who make their homes less vulnerable to wind damage.