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Insurance commissioner seeks more power over wind pool

Mississippi's insurance commissioner is pushing a bill to strip a tax subsidy and authority from the state's insurer of last resort for hurricane-prone coastal residents.

Posted: Jan 25, 2018 6:30 AM

JACKSON, Miss. (AP) — Mississippi's insurance commissioner is pushing a bill to strip a tax subsidy and authority from the state's insurer of last resort for hurricane-prone coastal residents.

Commissioner Mike Chaney says the Mississippi Windstorm Underwriting Association, known as the "wind pool," spends too much on backup insurance. The move would bolster his authority in his dispute with the board that runs the pool.

Chaney said the measure will make premium increases less likely on the pool's 25,000 policyholders in six coastal counties. Customers pay $1,700 on average to cover only wind and hail, buying insurance elsewhere that covers other risks such as fire, liability and theft.

The number of policies has been falling in recent years, in part because rates are deliberately kept high to encourage property owners to buy insurance from other carriers. Policies in the pool ballooned after 2005's Hurricane Katrina as traditional insurers balked at covering coastal risks.

House Bill 948 , sent Tuesday to the full House for more debate by the House Insurance Committee, requires the Republican Chaney's approval before the pool can buy more backup coverage, known as reinsurance, above a certain level. Chaney said he's been imploring the 11-member board that runs the pool to buy less reinsurance for years. The pool spent $38.4 million last year to buy enough coverage to cover $910 million in losses.

"Why are we buying so much reinsurance?" Chaney asked. He said his office will soon release an audit questioning how much the board buys and the rates it pays for reinsurance, saying Alabama's pool bought roughly the same amount of insurance last year, but only paid $15 million.

Pool manager Joe Shoemaker said that if the pool were to run out of money after a severe hurricane, insurance customers across the state would be forced to make up the shortfall. Shoemaker said the pool board wants to avoid such an assessment.

The bill also requires the pool self-insure at least $100 million in risk, using the $250 million the pool has built up from premiums and public subsidies. Chaney said that in years without a storm, that will allow the pool to spend less on reinsurance. Shoemaker said that move will deplete the pool's reserve if a hurricane strikes.

The bill would also divert $3 million yearly in insurance fees that have been subsidizing the pool since after 2005's Hurricane Katrina. That money would go to help buy rural fire trucks until at least 2021.

Some coastal members opposed the bill Tuesday, at least in part because they fear the pool will never regain the insurance fee subsidies if they are shifted to the politically popular fire truck program.

"This has the ability to be somewhat destabilizing for our constituents down on the coast," said Rep. Scott DeLano, a Biloxi Republican.

Mississippi Coronavirus Cases

Data is updated nightly.

Confirmed Cases: 15752

Reported Deaths: 739
CountyConfirmedDeaths
Hinds100625
Lauderdale73862
Madison72423
Scott65012
Neshoba64639
Jones62928
Forrest56438
DeSoto5427
Rankin4398
Holmes42928
Leake42712
Copiah3124
Jackson30813
Attala29817
Yazoo2814
Newton2714
Leflore26431
Lincoln26329
Harrison2587
Monroe25725
Oktibbeha23912
Lamar2385
Lowndes2119
Pearl River20931
Wayne2041
Pike20311
Adams19915
Noxubee1866
Washington1787
Warren17310
Covington1652
Jasper1634
Bolivar16211
Lee1536
Smith15211
Kemper14411
Clarke14418
Lafayette1364
Chickasaw13512
Coahoma1254
Carroll11711
Winston1171
Marion1159
Clay1124
Claiborne1112
Lawrence1021
Simpson1010
Tate941
Grenada943
Yalobusha935
Hancock9111
Wilkinson889
Itawamba877
Montgomery851
Sunflower843
Union835
Marshall833
Jefferson Davis773
Tippah7311
Panola713
Webster692
Calhoun654
Amite641
Humphreys607
Walthall560
Tunica553
Prentiss533
Perry503
Choctaw432
Jefferson421
Pontotoc353
Quitman330
Tishomingo320
Stone300
Franklin292
Tallahatchie271
George251
Alcorn171
Benton150
Greene131
Sharkey70
Unassigned00

Alabama Coronavirus Cases

Confirmed Cases: 18075

Reported Deaths: 644
CountyConfirmedDeaths
Mobile2239116
Jefferson1837102
Montgomery171040
Tuscaloosa78315
Marshall6939
Franklin5567
Lee54833
Shelby51720
Tallapoosa42765
Butler41118
Chambers35525
Walker3542
Elmore3548
Madison3394
Baldwin2909
Morgan2801
Dallas2723
Etowah25711
DeKalb2483
Lowndes24612
Coffee2361
Sumter2247
Autauga2214
Houston2204
Bullock2095
Pike2030
Colbert1842
Hale1739
Russell1710
Marengo1706
Barbour1671
Lauderdale1642
Calhoun1603
Choctaw1538
Wilcox1487
Clarke1442
Cullman1430
Randolph1277
St. Clair1231
Marion12211
Pickens1164
Dale1150
Talladega1135
Limestone1060
Chilton1011
Greene944
Winston900
Macon824
Henry802
Covington801
Jackson782
Crenshaw753
Bibb751
Washington706
Escambia633
Blount621
Lawrence500
Geneva430
Conecuh411
Coosa401
Monroe402
Perry390
Cherokee373
Clay272
Lamar260
Fayette160
Cleburne151
Unassigned00
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