Insurance working group explores multistate solution
But Lars Powell, the Whitbeck-Beyer Chair of Insurance and Financial Services at the University of Arkansas-Little Rock and CIWG member, warned the coastal band would create a political problem if large scale storms don’t hit multiple states within the first few years of its existence. He said it is important that the coastal band be allowed to bank premiums in non-storm years.
“If they see their money going to a specifically Alabama hurricane, it will be an unpleasant response,” Powell said. “You won’t have the same kind of political backlash with a big storm.”
…“We are here because the risk of hurricanes is huge and it makes insurance very expensive,” Powell said. “The choice we have is to pay the global market to take the risk, or to ask homeowners to do it on the back end.”
