Additional Funds to Help With Insurance Issues On The Coast

Mississippi has made it through the first month of hurricane season unscathed. But as MPB’s Phoebe Judge reports Gulf Coast residents are continuing to struggle to insure themselves in case a hurricane does hit in the future.

The state run wind pool provides last resort wind insurance for Gulf Coast residents who cannot find a private insurer to write them a policy because their risk just is too high. There were 16,000 policyholders in the wind pool before Katrina, but after that storm hit the numbers shot up to just under 43,000 and along with the rising numbers came rising premium prices. Last week Governor Barbour appropriated an additional 20 million dollars to help keep wind pool rates down. That decision comes after the Stennis Institute of Government prepared a study for the Gulf Coast Business Council which found that insurance costs on the coast are so prohibitive that the additional 20 million dollars for the wind pool would actually generate 27 million dollars in tax revenue. Brian Sanderson is president of the Gulf Coast Business Council,

“So it more than pays for itself. It’s not just a onetime subsidy, but a real economic injection that I think will benefit the entire state, not just the coast.”

Along with the added 20 million dollars, a new set of regulations went into effect on July 1st which may make wind pool participants eligible for up to a 25% discount for homes built in cities with a high degree of enforced building codes. Insurance Commissioner Mike Chaney,

“Any amount will help us no matter how small it is to lower rates on the Gulf Coast. You will not have recovery until you have affordable insurance on the Gulf Coast.”

Ideas to how to begin to solve the growing insurance problem on the Coast will be addressed next week when the Mississippi Insurance Department hosts the Catastrophe Preparedness & Insurance Forum in Biloxi.