The Heartland Institute Senior Fellow Alan Smith — our correspondent from the National Conference of Insurance Legislators’ annual meeting in Santa Fe, N.M. — sends word that the group’s Property-Casualty Insurance Committee has moved to push off consideration of its National Disaster Catastrophe Fund Model Act until NCOIL’s February 2012 meeting in Biloxi, Miss.
NCOIL, which is comprised of elected state legislators who focus on insurance issues, makes it a policy to review each of the model acts it has endorsed every five years to determine whether they are still valid and useful, or whether they should be allowed to sunset. The cat fund model was originally adopted in 1995, in the wake of Hurricane Andrew and the 1994 Northridge Earthquake, and was last reauthorized in July 2005, just prior to Hurricane Katrina.
Alan passes along word that Kentucky state Rep. Steve Riggs, D-Louisville, moved to defer acting on the model after the committee heard testimony from the Reinsurance Association of America, State Farm, Allstate Corp., the National Association of Mutual Insurance Companies, the Independent Insurance Agents and Brokers of America, the National Association of Professional Insurance Agents, the American Insurance Association, Cincinnati Insurance Cos. and The Heartland Institute.
The motion passed with an amendment from New York state Sen. James Seward, R-Oneonta, that the model should be amended to reflect other solutions, besides just cat funds, that coastal states have adopted since 1995 to address the risk of large natural disasters.
“(That) was a key part of my testimony – that it didn’t deserve to be a model because states had already fashioned solutions which make more sense,” Smith said.