Insurance Machine

Property Casualty Insurers or PCI, is encouraging state public policymakers to deal with the deficits and shortcomings in their residual markets. Assistant vice president and regional manager for the southeast at PCI, William Stander, says for several years there have been alarm bells in the coastal states of Florida, North Carolina and Texas. He says that as property exposure continues to grow, in order to help protect homeowners, state governments should stabilize the financial condition of these coastal insurance markets.

Before the advent of next year’s storm season, PCI will be pushing for healthy and competitive insurance markets, stiffer building codes when necessary, and additional consumer education on ways to protect homes and bring down losses through improvements. PCI vice president Robert Herlong, encourages lawmakers to consider the benefits of permitting insurers to establish tax-deferred, voluntary, pre-event reserves to fund catastrophe risks. One sound model he says, for approaching complex coastal issues, is the recent property insurance reforms in South Carolina. As he sees it, South Carolina is on the right track with a well thought out approach for shielding residents through programs to help homeowners lessen future storm damages and thereby persuade the private market to return to coastal areas. He adds that homeowners have the capability to set up tax-free savings accounts for the hefty deductibles and that state incentives are in place directed toward insurance companies that are writing more coverage along the coast.

There are several things that consumers are able to do today that can help them to be prepared well ahead of the hurricane season. For one thing, you should review your insurance policy with your agent or insurance company. Be confident that you have the proper coverage to meet your individual needs. Homeowners insurance usually does not include flood protection. An additional flood protection policy is needed. During winter and spring is usually the best time to carrying out routine home maintenance that can act to prevent major repairs if there is a hurricane or strong winds. A well kept home can help to ensure that roofing, windows and doors are secure. A major component for reducing the amount of damage that can occur when a hurricane or tropical storm makes landfall is storm-proofing. It is important to take proactive steps by building stronger homes and hardening existing homes, to not only protect your loved ones and most valuable assets, but also by reducing the risk of loss, to strengthen the property insurance market on both the state and federal level.

PCI, which represents the broadest cross-section of insurers of any national trade association, is composed of more than 1,000 member companies. Over $198 billion in annual premium is written by PCI members, which represents 40.5 percent of the nation’s property casualty insurance. PCI member companies also write 51.6 percent of the U.S. automobile insurance market. In addition they write 39.7 percent of the homeowners market, 33.2 percent of the commercial property and liability market, as well as 38.7 percent of the private workers compensation market.