WASHINGTON, D.C., April 11, 2007— The Independent Insurance Agents & Brokers of America testified today on the need for a national solution for natural disaster coverage, noting that natural disaster risk poses a looming crisis for consumers.
The association shared its perspective on the availability and affordability of property-casualty insurance in the Gulf Coast and other coastal regions before the Senate Committee on Banking, Housing and Urban Affairs. In its testimony, the Big “I” thanked Chairman Dodd for calling the hearing and also thanked the many other members of Congress who have proposed legislative solutions to address natural disaster issues.
“Our members approach the issue of natural disaster insurance from a very simple perspective: we are here to serve consumers' needs, whether it is helping them secure coverage to protect their families and their homes prior to an event, or assisting consumers after an event to ensure that claims are paid quickly and fully,” the Big “I” said in written testimony. “Our members are keenly aware of the unmet need for insurance coverage in at-risk areas. Our members cannot, and will not, walk away from these consumers. We strongly believe our industry must come together with policymakers to find a solution that will encourage participation in at-risk markets. In short, we welcome all proposals and will support any reasonable plan that leads to a healthy and competitive insurance marketplace in which consumers have choices and companies are vying for their business.”
Natural disaster risk poses a looming crisis for consumers, the Big “I” noted. As a conduit between consumers and insurers, the Big “I” recently joined the Natural Catastrophe Policyholders Coalition as an ex-officio member. The goals of the coalition are to create a forum to share information and to develop and promote policies to ensure the availability and affordability of catastrophe insurance to both homeowners and businesses.
The association expressed its support for H.R. 330, the Homeowners' Insurance Availability Act, sponsored by Rep. Ginny Brown-Waite (R-FL), and its willingness to consider other approaches. The legislation would allow private insurers to purchase, at auction, reinsurance contracts directly from the U.S. Treasury to cover natural disasters that are equal to or greater than a one-in-100-year event.
“Put simply, insuring against natural disasters is a national problem that requires a national solution,” the Big “I” said. “Despite our longstanding position that the insurance market is best served by limited federal involvement, we believe that a federal solution to the issue of natural catastrophe insurance is necessary to help provide capacity and fill a void that the private market cannot and will not service.”
Founded in 1896, IIABA (the Big “I”) is the nation’s oldest and largest national association of independent insurance agents and brokers, representing a network of more than 300,000 agents, brokers and their employees nationally. Its members are businesses that offer customers a choice of policies from a variety of insurance companies. Independent agents and brokers offer all lines of insurance—property, casualty, life, and health—as well as employee benefit plans and retirement products. Web address: www.independentagent.com.