Climate and cost concerns mount in wake of “superstorm”
Some taxpayer groups have called on Congress to further reform the flood insurance program and said that reinsurance companies are better positioned to absorb the costs and risks related to extreme weather occurrences.
“It appears likely that Sandy will exhaust the NFIP’s remaining $3 billion of statutory borrowing authority, meaning it will need to request more money from Congress to pay its claims,” said R.J. Lehmann, a senior fellow at free market policy research group R Street.
The R Street Institute is the insurance spinoff of the Heartland Institute, a group which has funded several high-profile campaigns questioning manmade climate change, but Lehmann has said the group does not promote “climate skepticism.”
“In the short term, we would insist the NFIP use its existing authority to raise rates, buy reinsurance and issue catastrophe bonds, so that the private market, rather than taxpayers, assume the risk of these sorts of catastrophes in the future.
