Eli predicts that under a national catastrophe fund, insurance prices would be systematically under-priced and taxpayers would be responsible for any costs when the fund is extinguished.
“By concentrating risk within the borders of the United States, a national catastrophe fund would have to charge more than the private market does. Most likely, the government would systematically under price coverage and leave taxpayers holding the bag. The National Flood Insurance Program already owes the Treasury more than $17 billion and has no way to pay it back. A catastrophe fund would be even worse. Florida’s property insurance market needs less government intrusion, not more.”
Eli’s piece, “U.S. Catastrophe Fund a Bad Idea,” is available online at: http://www.tampabay.com/opinion/letters/mondays-letters/1179570