November 20, 2008

Catastrophe Experts Predict Quick Action on Backstop Programs
NCOIL model being considered in several states

National fund has backing of new administration

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.

'The US House of Representatives, quickly passed the Homeowners’ Defense Act of 2007 last year by a wide and bipartisan margin (258-155) and, given the support of President-elect Obama as well as inclusion of catastrophe insurance language in the platform statements of both major political parties, we are confident that the national backstop will be passed in the next session of Congress and signed by the President,' he said.

'Action at the state level is just as promising. States from Massachusetts to Texas are considering bills fashioned after the model legislation adopted by NCOIL because legislators in those states recognize the growing threat posed by massive storms or earthquakes striking at or near any of our metropolitan areas,' Collins said.

'The simple fact is that 6-in-10 American families live in areas that are prone to massive natural catastrophes. The threat has never been higher and the potential loss of life and property has never been greater,' Collins said.

'Natural events, like the extraordinarily active recent Atlantic Hurricane seasons, and economic events like the massive financial bailouts that taxpayers are now funding, have combined to underscore the recognition that pre-funding catastrophe funds to prepare for the unthinkable and the unavoidable is the most responsible path that state and federal legislators can take to meet their responsibilities to the public,' he said.

Collins noted that this is a national problem that requires an integrated and comprehensive local, state and national response.

He talked about the need for better prevention and mitigation and outlined how the NCOIL model bill and a well-structured national program can help provide funding for this critical need.

He applauded NCOIL for its leadership on this issue and committed to continuing to work with them to strengthen America’s infrastructure in a responsible, pro-active way.

ProtectingAmerica.org is a non-partisan organization chaired by James Lee Witt and Admiral James M. Loy.  Mr. Witt served for eight years as the director of the Federal Emergency Management Agency.  Admiral Loy was formerly the deputy secretary of the US Department of Homeland Security and formerly served as commandant of the United States Coast Guard.

At the core of ProtectingAmerica.org’s mission is the establishment of a comprehensive, integrated national catastrophe management solution that will better prepare and protect American families, communities, consumers and the American economy from catastrophe.  Among its efforts to support this mission, ProtectingAmerica.org is working to increase public awareness and consumer education; advocate for better coordination with local, state and federal mitigation and recovery efforts, and strengthen emergency response and financial mechanisms to rebuild after a major catastrophe.