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Racicot Comments on the End of the 2007 Hurricane Season |
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11/30/2007 |
FOR IMMEDIATE RELEASE
Contact: Julie Pulliam, (404) 261-8834
The Responsibility of Preparing for Future Hurricanes Cannot Stop on December 1
WASHINGTON, D.C., Nov. 29, 2007 -- Gov. Marc Racicot, president of the American Insurance Association (AIA), issued the following statement on the relatively quiet 2007 hurricane season.
Gov. Racicot's statement follows:
"We can all be thankful that the 2007 hurricane season was a quiet one here in the U.S., but we cannot let our guard down. We were lucky this year and the heightened threat from destructive storms remains and is expected to last for a number of years to come. In fact, two Category Five hurricanes that made landfall this year in Central America could just as easily have come ashore along the Gulf states and the East Coast, doing untold damage to people and property.
"Despite a quiet couple of years, insurers continue to face challenges in coastal markets. In a healthy insurance market, premium rates reflect the risks, costs and exposure faced by policyholders. Risk-based pricing permits and motivates insurers to remain in a market. Government policies, whether at the federal or state level, that serve to subsidize the risk of coastal policyholders at the expense of policyholders in less risky areas, are not the solution. Our country's ability to manage catastrophic storm risk rests on our ability to undertake an honest debate about the long-term consequences of such government intervention, and the disincentive such intervention provides to the private market. Unfortunately, these policies are already in place in states like Florida, while others continue to be debated at the federal and state level.
"The responsibility of preparing for future hurricanes cannot stop on December 1. One area where progress has been made since the 2006 hurricane season is the investment by state and local governments in property loss prevention, including effective building codes and government policies that provide incentives to policyholders to harden their homes against hurricanes. While the tendency after a quiet hurricane season is to do less on this front, now is the time to do more to prepare."
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The American Insurance Association represents approximately 350 major insurance companies that provide all lines of property and casualty insurance and write more than $123 billion annually in premiums. The association is headquartered in Washington, D.C. and has representatives in every state. All AIA press releases are available at www.aiadc.org.
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