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Taxpayers May Face Hurricane Tab [Democrats want to nationalize insurance business]
WSJ ^
| May 31, 2008
| ELIZABETH WILLIAMSON
Posted on 05/31/2008 4:35:23 AM PDT by Brilliant
As hurricane season begins, Democrats in Congress want to nationalize a chunk of the insurance business that covers major storm-damage claims.
The proposal -- backed by giant insurers Allstate Corp. and State Farm Mutual Automobile Insurance Co., as well as Florida lawmakers -- focuses on "reinsurance," the policies bought by insurers themselves to protect against catastrophic losses. The proposal envisions a taxpayer-financed reinsurance program covering all 50 states, which would essentially backstop the giant insurers in case of disaster.
The program could save homeowners roughly $500 apiece in annual premiums in Florida...
But environmentalists and other critics ...say lower premiums would more likely spur irresponsible coastal development, already a big factor in insurance costs. The program could also shift costs to taxpayers in states with fewer natural-disaster risks.
"This bill makes it a little bit too easy for the state to go to the federal government for a bailout," said Eric Goldberg, associate general counsel at the American Insurance Association...
The two Democratic contenders, Sen. Hillary Clinton of New York and Sen. Barack Obama of Illinois, in their recent visits to Florida -- a key swing state -- have both voiced support for the plan...
"I'm calling on the voters in both parties to demand that the nominee of their party publicly support a national disaster fund," said Florida state Sen. Steven Geller, an uncommitted Democratic superdelegate. "If they won't, vote for the other party."
Republican presidential candidate Sen. John McCain, who badly wants to win Florida, is resisting calls to back the program...
The proposal envisions the creation of funds like Florida's in all 50 states...
In order to draw congressional support from states with somewhat less disaster risk, the federal program is designed to kick in for events that don't necessarily approach the catastrophic level...
(Excerpt) Read more at online.wsj.com ...
TOPICS: Business/Economy; US: Florida; US: Louisiana
KEYWORDS: congress; globalwarming; insurance; storms
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Isn't socialism grand?
1
posted on
05/31/2008 4:35:23 AM PDT
by
Brilliant
To: Brilliant
Democrats want to nationalize all buisness and make themselves the biggest thieves of all time. And the rinos love it.
2
posted on
05/31/2008 4:39:28 AM PDT
by
kindred
(I am now a third party conservative and glad conservative Bob Barr will be on the ballot..)
To: Brilliant
A billion dollars here, a billion dollars there....pretty soon we’re talking some serious money....
3
posted on
05/31/2008 4:40:45 AM PDT
by
FDNYRHEROES
(Always bring a liberal to a gunfight)
To: Brilliant
It’s all over, folks. We might as well declare the idea of the land of the free and the home of the brave officially over.
4
posted on
05/31/2008 4:42:03 AM PDT
by
basil
(Support the Second Amendment--buy another gun today!)
To: Brilliant
What don’t socialists want to nationalize?
5
posted on
05/31/2008 4:45:09 AM PDT
by
Man50D
(Fair Tax, you earn it, you keep it!)
To: Brilliant
The program could save homeowners roughly $500 apiece in annual premiums in Florida...As a Floridian, I could sure use the break of $500, but not on the backs of my fellow citizens
What about earthquakes in Kalifornia or twisters in the midwest, Congress going to insure every major disaster?
6
posted on
05/31/2008 4:56:05 AM PDT
by
Popman
To: Brilliant
Isn't this already effectively nationalized? How many people who lose everything, especially in flooding situations, get bailouts? It is disgusting!
I don't get why home insurance doesn't work like car insurance. At least with car insurance, insurers will refuse to write policies for certain vehicles because of the potential for loss. Why can't home insurance be the same way?
7
posted on
05/31/2008 4:56:27 AM PDT
by
pnh102
(Save America - Ban Ethanol Now!)
To: Brilliant
So some family that lives in Tornado Alley,pays stiff premiums just in case will now subsides those who want to live in a Fl flood and hurricane zone next to the ocean so the insurance companies can retain a decent profit margin.I always though insurances was a gamble,for the consumer and the provider. I moved from the ocean because of that reason...now they are going to bail out another group of "RISK" takers?
8
posted on
05/31/2008 4:57:10 AM PDT
by
CGASMIA68
To: Brilliant
The proposal envisions a taxpayer-financed reinsurance program covering all 50 states, which would essentially backstop the giant insurers in case of disaster.
I live in central Maryland. Why should more of my income be confiscated via taxes just to subsidize some much wealthier folks who have vacation homes in Ocean City that are at risk of hurricane damage? Why should more of my income be confiscated via taxes to shore up insurance companies losses on these properties that were not adequately insured in the first place and that I have no material stake in?
9
posted on
05/31/2008 4:58:14 AM PDT
by
Caramelgal
(Rely on the spirit and meaning of the teachings, not on the words or superficial interpretations)
To: pnh102
They do...I had a chance to buy a place in Floridana Bch by the flashing light just after Andrew......I was thrilled I finally made it,(so I thought) a place between the ditch and A1A...Well guess what? No one would write it because I was going to finance VA or FHA.
To: Man50D
What dont socialists want to nationalize?Freedom and individual responsibility.
11
posted on
05/31/2008 5:02:03 AM PDT
by
meyer
(Still conservative, no longer Republican)
To: pnh102
It is, actually. After the huge losses suffered by the insurance companies in Katrina and several Florida hurricanes (partially because they did not re-insure enough, greedy bastards) they have refused to write hurricane insurance in those areas.
What they are trying to do isto write the insurance but lay off the re-insurance risk on the government (read-you and me).
They already have gotten away with some of this through FEMA flood insurance which never shouldhave been available in the first place.
As to FEMA insurance etc, as the Good Book says, "The man that builds his house upon the sand is a foolishman."
12
posted on
05/31/2008 5:02:36 AM PDT
by
Jimmy Valentine
(DemocRATS - when they speak, they lie; when they are silent, they are stealing the American Dream)
To: Brilliant
Florida folks have cheap taxes...and that’s a big draw to the state....especially for retirees. So they have to pay flood insurance...Boo Hoo. Let the state provide the insurance...and raise FLORIDA taxes....not mine.
13
posted on
05/31/2008 5:03:06 AM PDT
by
Sacajaweau
("The Cracker" will be renamed "The Crapper")
To: Brilliant
Katrina, and Bush's response (free $1000 gift cards, anybody?) opened the door for all this. Instead of rightfully letting Louisiana’s taxpayers carry the weight of Louisiana’s problems, Bush caved to the liberals and used a great deal of federal money to bail out that state.
So, those of us living in the other 49 states got to pay for somebody else's stupidity.
14
posted on
05/31/2008 5:05:28 AM PDT
by
meyer
(Still conservative, no longer Republican)
To: Brilliant
Hurricane (Windstorm) insurance virtually nationalized here in Florida now
and it's a nightmare
my premium is over $10K and my deductible (mandatory) is $25K
so I need to sustain $35K in damage before I see a penny
You are better off putting the $10K each year into hardening the house (shutters, roofing, storm proof windows) then banking the premium
conversely if you don't have windstorm insurance and your house is damaged your homeowners carrier has no one to delay the claim by arguing with the other carrier and FEMA kicks in.
Windstorm premiums are literally money thrown into the wind ..... when it's socialized the ever increasing federal mandates for material and compliance will be used to regulate where you can have a home
the federal government does nothing well or efficiently they will muck up insurance as surely as they have everything else they attempt
.
15
posted on
05/31/2008 5:05:49 AM PDT
by
Elle Bee
To: Sacajaweau
They don't have to pay flood its an option.....Flood only covers “rising” water.If it blows in side ways or through the roof torn off from a hurricane it don't count
To: FDNYRHEROES
originally said by one everett dirkson I believe..
17
posted on
05/31/2008 5:06:27 AM PDT
by
GeorgiaDawg32
(www.liberallunacy.bravehost.com..I'm a Patriot Guard Rider. www.patriotguard.org for info.)
To: Brilliant
"And guess what this liberal would be all about? This liberal wh0re would be all about socialize -- er, uh, uh, uh, uh, would be about basically tabaking obover and the gobovernment rubunning all of your cobompanies."
18
posted on
05/31/2008 5:07:11 AM PDT
by
RoadKingSE
(How do you know that the light at the end of the tunnel isn't a muzzle flash?)
To: Caramelgal
Why should more of my income be confiscated via taxes just to subsidize some much wealthier folks who have vacation homes in Ocean City that are at risk of hurricane damage?Welcome to the Obamanation, comrade!
19
posted on
05/31/2008 5:09:44 AM PDT
by
Popman
To: Elle Bee
I have a friend in Coral Springs who is doing just that.He has a fund to replace his roof which he figures will be the biggest nut if he gets hit.His fund is cheaper than the premiums and is growing at 5% +- in fixed income. He figures when he sells if he never gets hit he has made money vs the ins company.
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