Barbour signs bill to put $25M in wind pool
Published 7:12 pm Friday, March 21, 2008
Gov. Haley Barbour on Thursday signed a new law transferring $25 million into a fund that assists the state wind pool.
The law took effect immediately, and Insurance Commissioner Mike Chaney said the infusion of money should decrease insurance rates an average of 11 percent for coastal homeowners.
“The Legislature’s intent … is working, and that was to lower rates,” Chaney said Thursday. “My job is to get the lowest rates possible, and I intend to do that.”
The $25 million is part of an $80 million package lawmakers approved for the wind pool last year. The new law simply gives authority for the $25 million to be transferred for use.
The wind pool is the insurer of last resort for those who need wind coverage in high-risk areas where no private insurer will write policies.
“This bill follows through on the commitment made in legislation last year to help lower wind insurance costs while the insurance market stabilizes,” Barbour said in a news release. “This infusion of money, coupled with many other steps being taken, is another strong indication of confidence that we will rebuild the Gulf Coast bigger and better than ever.”
Chaney has said rates increased 90 percent for homeowners and 162 percent for businesses after Hurricane Katrina’s storm surge devastated the region in August 2005.
Some insurance companies stopped writing new policies. That led to a spike in the number insured by the wind pool, which is funded by assessing all insurance companies that provide property coverage in the state.
The wind pool has about 36,000 policies. Most are held by homeowners in the six south Mississippi counties of Hancock, Harrison, Jackson, Pearl River, Stone and George. When Katrina hit, the wind pool only had 16,000 policies.
Chaney wrote the legislation that created the $80 million package when he was in the Senate last year. He has the power to transfer the remaining $55 million to the wind pool program over the next three years with legislative approval to help keep costs down.
The bill is House Bill 1640.