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Last Post 09/24/2009 4:44 PM by  Medulus
Report on Solvency of Wind Pools
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Medulus
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09/09/2009 2:06 PM

    Here is one of the most recent reports on the ability of Wind Pools in general, and Citizens Florida in particular, to pay their claims.

     

    http://www.claimsmag.com/News/2009/...aspx 

    Steve Ebner CPCU AIC AMIM

    "With great power comes great responsibility." (Stanley Martin Lieber, Amazing Fantasy # 15 August 1962)
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    Jud G.
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    09/15/2009 11:34 AM

    The NFIP ran out of money during Katrina, but a swift act of congress flooded its coffers with your tax dollars. Granted, that's a Federal program, but if the Federal Govt. was able to bail out Privately owned companies, I'm sure that they'd be more than happy to bail out (buy and control) state-run entities.

    Looks like this is yet another convenient, power-snatching position that our 'big government' President may find himself in.

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    Medulus
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    09/15/2009 2:56 PM
    The "bailout" of NFIP is a bit misleading. Normal insurance companies are required to put aside reserves, invest them and keep them on hand to pay claims. What happens to the money collected by the NFIP? It goes into the general pot and is spent indisciminately by Congress. The first time I heard this (not in exactly those terms, mind you) my jaw dropped open. Then, when there is a shortage of money to pay claims, they have to go to Congress and ask them to authorize funds. That's the facts. Check it out. Believe it or don't!
    Steve Ebner CPCU AIC AMIM

    "With great power comes great responsibility." (Stanley Martin Lieber, Amazing Fantasy # 15 August 1962)
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    Medulus
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    09/24/2009 4:44 PM

    Here is an article from the weekly online version of Claims magazine that explains part of the NFIP situation:

     www.claimsmag.com/News/2009/9/Pages...Cover.aspx

    Note that the article points out that "several years prior to these events (the hurricanes of 2004 and 2005), Congress moved monies from NFIP premium reserves (which at the time were described as excessive) to off-set FEMA operating expenses and redirect the savings to other federal government programs.”

    In English, this means our lawmakers decided the NFIP had too much money and decided they wanted to use that money to fund their pork projects instead, so they took the money that should have been used to fund claims and spent it. Then an event comes along for which they need the funds they have already spent, and they see this as a failure of NFIP because they have to blame someone. Our government at work!


     

    Steve Ebner CPCU AIC AMIM

    "With great power comes great responsibility." (Stanley Martin Lieber, Amazing Fantasy # 15 August 1962)
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