Dale's campaign burdened by Katrina, Democrats flap

RIDGELAND, Miss. -- Hurricane Katrina has nearly knocked the wind out of George Dale's re-election campaign for Mississippi insurance commissioner, a job he's held for 32 years.

Dale is the longest-serving state insurance commissioner in the nation. He's been crisscrossing the state for weeks, trying to win support in what's proven to be his toughest race.

His challenges include a strong opponent in the Aug. 7 Democratic Primary and a bitter dispute with Democrats over his loyalty to the party.

But his biggest albatross may be an advertising campaign financed by attorneys who represent policyholders in lawsuits against the insurance industry over rejected Hurricane Katrina claims.

Had my first election been as different as this one, I never would have run again," Dale said.

Recently, Dale gave a three-minute stump speech at St. Catherine's Village, a retirement community in Ridgeland. It was a candidates' forum and Dale's challenger, Gary Anderson, a former state fiscal officer, didn't attend

"The guy I'm running against is a class act. Gary has run a decent campaign, but I'm actually running to some degree against outside forces," Dale said after his speech. "I'm talking Dickie Scruggs and those lawyers. They run cartoons and they've run ads and everything to try to discredit me statewide."

Scruggs, a high-profile attorney who helped negotiate a multibillion dollar settlement with tobacco companies in the mid-1990s, represents hundreds of homeowners in lawsuits against insurers.

As insurance commissioner, it was Dale's job to referee the fallout from Hurricane Katrina. On Aug. 29, 2005, the killer hurricane's storm surge devastated the Gulf Coast, destroying thousands of homes and businesses.

After property owners scurried to recoup their losses from insurance policies, many of them learned that their coverage didn't include the flooding caused by Katrina.

In addition, many of the state's insurance providers raised their policy premiums. At least one, State Farm Fire and Casualty Co., the state's largest homeowner insurer, suspended writing new homeowner and commercial policies statewide.

Criticism was leveled at Dale, accused by some of favoring the insurance companies in payoff disputes with storm victims and by others of failing to force insurers to hold down their rates."

Anytime someone does not get their claim paid, they're unhappy and accuse you of being on the side of the insurance company. It's nothing new. That goes on when there's not an election," Dale said.

But then Dale found himself at odds with the Scruggs law firm.

Scruggs has been critical of a mediation program sponsored by Dale's office that allows homeowners to negotiate settlements with their insurers without resorting to litigation.

Scruggs has said the program "has no teeth in it."

And, months after Scruggs' legal team withdrew support for a January deal that called for State Farm to pay at least $50 million to some 35,000 policyholders, the insurer reached a separate but similar agreement with Dale.

The Scruggs Katrina Group has run a series of television and newspaper ads critical of the insurance industry and unflattering to Dale. Zach Scruggs, the son of Dickie Scruggs and a member of the firm, described the ads as educational.

Still, one newspaper ad depicted Dale as a pig being covered in pink lipstick by State Farm executives. The caption read: "Lipstick On A Pig."

"George Dale is obviously a big part of the problem on the Gulf Coast, and in Mississippi in general, because he's the one that fills in the amount that every Mississippian has to pay for insurance," Zach Scruggs said. "The fact that it is an election year doesn't change the fact that we have an insurance crisis in Mississippi."

Dale, 66, said many voters don't understand the limitations of his powers and the complexities of his job.

His duties include regulating the insurance industry, licensing manufacturers and dealers of mobile homes, serving as state fire marshal and chairman of the State Fire Academy. He's been on the job since January 1976.

He said most of his time is now devoted to settling the remaining Katrina claims and ensuring that insurance companies continue to provide coverage in the state at the lowest possible rates. He said two providers _ Shelter Insurance Co. and Allstate Insurance Co. _ have reduced their rates in certain areas of north Mississippi.

"You can't overlook the fact that this is the largest natural disasters in the history of the U.S.," Dale said, adding that 99 percent of the claims have been settled.

However, Zach Scruggs said the term "settled" could mean closed, but not necessarily paid. Scruggs said many of his firm's clients were lumped into the settled category. So far, he said the firm has won more than $200 million for 1,200 clients.

Dale, a former high school principal who served as an assistant to then-Gov. Bill Waller, retains the respect of his peers for his fairness, said National Association of Insurance Commissioners president Ragan Ingram. The Alabama insurance commissioner explained that the role of insurance commissioner always becomes more difficult after a natural disaster.

"There must be some reason that the people of Mississippi have elected him to office eight different times," Ingram said.

Earlier this year, Dale was embroiled in another controversy over his re-election bid. The state Democratic Executive Committee sought to remove him from the party ballot.

Committee members argued that Dale shouldn't run under the party label because he publicly supported President Bush for re-election in 2004. In May, a Calhoun County circuit judge reversed the decision and put Dale back on the Aug. 7 primary ballot.

"It was going to be a tough election for him regardless ... but that added to the question of 'What's up with George Dale?'" said Marty Wiseman, director of the John C. Stennis Institute for Government at Mississippi State University.

Dale's Democratic challenger also paints him as being too cozy with the insurance industry. Anderson, who oversaw Mississippi's $10 billion budget as state fiscal officer between 2000 and 2003, points to campaign contributions Dale has received from industry insiders.

"It's a pocketbook race. How can you look out for the consumers when you're in the back pocket of the insurance company?" asked Anderson, who has said he will not accept any contributions from the industry.

Dale has more than twice the amount of campaign cash as Anderson, and he defended contributions from local insurance agents, saying they want to elect someone who will fairly regulate them.

If Dale is successful in the primary, he still faces a Republican in November. The Republicans running for insurance commissioner are state Sen. Mike Chaney, of Vicksburg, and Ronnie D. English, of Vancleave.

Before leaving the retirement community, Dale asks two women for their votes.

"I've seen your picture on television," one woman said.

"I hope so," Dale said. "I paid enough to get on there."

Copyright 2007 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.
Published by KATC-TV Mobile, Alabama

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Drugs, lack of jail hover over Hancock

By J.R. WELSH
baybureau@aol.com

HANCOCK COUNTY -- The three men who want to be sheriff here all identify the same major problems facing the county, as it still struggles to emerge from under a post-hurricane cloud.

The troubling lack of a county jail and a growing drug problem top the list for Sheriff Steve Garber and challengers Terry Necaise and Nathan "Corky" Hoda. Since none of the candidates is running as a Republican, one of them must get at least 50 percent of the primary vote to avoid a runoff. If that doesn't happen, there will be a runoff between the top two vote-getters in the primary.

The jail issue comes first, they say: Hurricane Katrina extensively damaged the county jail on Court Street in Bay St. Louis. Nearly two years later, county supervisors are still at a stalemate with FEMA over federal funding for a new lockup.

"We have to get some type of facility going," said Garber, who is seeking a third term as sheriff. Hancock County is paying Pearl River County $30 per day for each male prisoner being housed there, and now the Pearl River County jail itself is overcrowded. Depending upon the severity of their sentences, female prisoners are being sent to jails as far away as Natchez.

Hoda, a former longtime sheriff's deputy and narcotics investigator, said: "The number one thing would be the jail. We have to get something done about that. The county is spending a fortune to pay for sending our prisoners to other jails."

"Nothing is being done," said Necaise, a constable and former reserve police officer. Figure in high gasoline costs and the loss of sheriff's personnel from the county during prisoner transports, and the cost rises even more, he said.

Not the sheriff's solution

But the political reality is that even though the sheriff runs the jail - if there were one - it's up to county supervisors to find a solution. Supervisors recently approved a contract for a prison design and building firm to examine the damaged jail and make recommendations.

Meanwhile, at last report, FEMA officials were still saying damage was not so extensive that the old jail can't be repaired, instead of completely replaced. The county must reach some agreement with FEMA.

"That's a decision the supervisors have to make, and we're working with them," Garber said.

Hoda thinks the county needs to push harder. Necaise agrees, and said he would urge Bay St. Louis and Waveland to also get involved in the struggle, since their arrests contribute to the jail population.

"Some form of decision needs to be made," he said. "There has to be a compromise some place. I think all parties have to sit down in a meeting and work this thing out until something comes together."

$72,000 a year

The office of sheriff is a powerful and well-paid position, with a salary that is set by state law and hinged to population figures. In Hancock County, where the estimated median income was $37,009 in 2005, the sheriff is paid $72,000 a year.

All three candidates bring various degrees of law enforcement and emergency service experience to the race.

Garber began his career as a deputy sheriff in 1985, serving in various capacities. In addition, he was a Hancock County constable from 1992 to 1996 and also worked as an administrator at the Waveland Fire Department. He was elected sheriff in 2000 and won re-election in 2004.

Hoda began in 1979 as a junior deputy in Hancock County. He eventually became a patrol sergeant and also worked in officer training. He was later named the department's lead narcotics investigator, in addition to working fatality traffic accidents and serving with the dive rescue team. He left the Sheriff's Department in 2000 and now owns a construction business.

Necaise is a Hancock County constable and teaches Naval ROTC at Brother Martin High School in New Orleans. He retired from the Navy as a chief petty officer. He went through reserve officer training with Garber's department and said he has also been a reserve state trooper in Florida and completed training at the Kissimmee Police Academy.

Fighting the drug problem

The candidates say drug use, particularly with crack cocaine and methamphetamine, is nearing epidemic proportions in the county. The Sheriff's Department regularly arrests low-level dealers and busts home-style meth labs, often in rural areas.

"We're a leader in drug enforcement in the state," Garber said. He said his department has also been establishing anti-drug awareness programs through schools, churches and community groups, but more needs to be done.

"We've shown that we can arrest," he said. "The problem now is we need to reach these people before they get on these drugs."

Both Hoda and Necaise acknowledge the severity of the drug problem. But as a former narcotics officer, Hoda takes an especially strong stand on the issue.

"It's outrageous right now," he said. "It's like a cancer eating away at this place. It's everywhere."

He thinks the Sheriff's Department should do more by seeking more anti-drug assistance from outside agencies: "We've got to have the state and federal levels more involved."

However, stepping up drug enforcement becomes even more difficult if the county has no place to put its felony prisoners.

"It is a 96-mile round trip from the facility on Longfellow to the Pearl River County jail," Necaise said. Even if a decision on the jail were made tomorrow, he said, "we're still looking at 2½ to three years before we see the inside of a criminal justice facility."

Original article published in Sun Herald on July 29, 2007.


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Insurance is hottest seat in the state

By ANITA LEE
calee@sunherald.com

-- The Democratic and Republican opponents of Insurance Commissioner George Dale say change is long overdue, but Dale says his 32 years' experience is what Mississippi needs at a critical time.

"We're pretty well stressing the fact that this is a very delicate time dealing with consumer and property insurance in this state," Dale said in a recent interview. "We feel like this office can be better served by someone who has experience."

His Democratic opponent, Gary Anderson, along with Republicans Mike Chaney and Ronnie English, believe Dale's experience has drawn him too close to the industry he regulates. They advocate a more consumer-friendly approach at a time when Katrina, the nation's costliest disaster, has exposed flaws with public and private insurance coverage.

"Mr. Dale has just not done anything over the years to try to protect the taxpayers," English said.

All three opponents say they have refused to accept campaign contributions from insurance companies, which Dale does.

"I want to establish a business relationship with insurance companies, not a cozy relationship where I'm taking money from them," said Anderson, a lobbyist and member of former Gov. Ray Mabus' administration.

State Sen. Mike Chaney believes Mississippi's insurance commissioner should be appointed, which is the case in most states. "The reason is real simple," Chaney said, "I don't know how many people can take dollars from the insurance companies every four years to run for this position and still be impartial in their judgment in regulation of the companies."

All four candidates agree the next insurance commissioner needs to work on the affordability and availability of insurance. Dale's opponents also say they want to find more funding for rural fire protection.

The insurance commissioner is charged with licensing and regulating insurers. He also serves as state fire marshal, and licenses and regulates burial associations, motor clubs, bail bondsmen, and mobile home manufacturers and dealers.

Anderson faces Dale in the Aug. 7 Democratic primary. Chaney, a Vicksburg developer and businessman, will square off against English, a Northrop Grumman fire marshal from Vancleave, in the Republican primary. Winners advance to the Nov. 6 general election.

Dale vs. Anderson

It's easy to say you want to lower insurance rates and improve the market, Dale said, but not so easy to do.

Predictability is one thing insurance companies must have, he said, pointing out that his philosophy and personality are familiar to the industry.

"The philosophy is that I attempt to be fair," he said, "...to be aggressive in helping the consumer, but at the same time fair with the companies. I try to walk that thin line between the consumer and the companies, which is a difficult line to walk."

Dale believes he can persuade insurers to return to the Coast with wind coverage, available for many property owners only through the state wind pool, the insurer of last resort.

Unlike other candidates, Dale is not promising lower rates, but said more competition in the market should help.

"A lot of people have a misconception that we just pull rates out of the air," he said. "Rates have to be actuarially sound. They're based on experience and we have some control, but at the same time we have no control over what causes these rates.

"The very trite and smart-aleck answer would be you could reduce rates on the Coast if we had fewer hurricanes."

Anderson also sees the cost of insurance as one of the most pressing issues in 2007 and believes competition is the answer. Anderson said a vibrant economy is a major selling point that will allow him to market Mississippi to insurance companies.

"We've got to create an environment where there is more competition within the insurance industry and then we'll also have lower insurance premiums," Anderson said. "The cost of insurance is out of reach for many households, so we need to make sure we do the things that make it become more affordable in our state."

Anderson also promises to expand fraud detection, especially because pitchmen are selling elderly Mississippians supplemental Medicare plans that actually replace their coverage at higher prices.

He also wants to require insurers to offer discounts for those who meet stronger building codes and said he will study a stronger policyholder bill of rights, but is not making any promises.

"I would want to study those things that are consumer friendly and make sense from an industry standpoint," he said. "I'm not prone to knee-jerk reactions."

Chaney vs. English

Chaney, a legislator since 1993, believes consumers should be able to track an insurance company's claims payment record on the Mississippi Department of Insurance Web site: doi.state.ms.us. He said the department should rank insurance companies based on the number of claims filed and paid.

He also supports a stronger policyholder's bill of rights. A bill of rights Dale put into place provides homeowners a checklist of what their insurance policy covers and lists rights to which policyholders already are entitled.

In the Legislature, Chaney worked for approval of stronger building codes and for a program that will allow the state wind pool to reduce rates for those who build to stronger standards. He also says he would work with other states that face similar insurance issues to form a coalition that would be in a better bargaining position than Mississippi alone.

Chaney also believes insurance companies should be required to offer homeowner and commercial property policies if they want to sell automobile policies here.

He hopes to lower fire insurance ratings through better training and would seek federal funding sources.

"Whether I win or lose in this race," he said, "I've already made a difference."

English jumped into the insurance commissioner's race because of the problems he saw after Katrina.

"We have to hold these insurance companies accountable," he said. He believes insurance companies were too eager to write off damage to storm surge covered by federal flood insurance rather than wind damage the companies have to pay.

"The wind beat for hours on these structures even before the water got here," he said, "but yet these insurance companies want to lay everything off on water."

He also believes insurers should be required to assume more risk if they want to sell policies for lower risks.

He doesn't like having a state wind pool. "Really, I think an insurance company should be covering the wind damage and I don't think the taxpayers should be picking it up," he said, pointing to industry profits even with major disasters in 2004 and 2005.

"They're putting profit ahead of paying these claims," English said, "and I don't think it's right."

He also thinks tax dollars should be spent to provide better equipment and more funding for fire departments.

ELECTION 2007

Meet the candidates.
Four candidates are running for state insurance commissioner. They are:

• Democrats
Gary Anderson of Jackson

Current occupation: Governmental relations, financial analysis and economic development consultant, The Anderson Co., LLC., 1997 to present.

Highest educational degree: Master's degree, University of Mississippi, 1980.

Personal: 51 years old, married.

Why I'm running: "I am running for insurance commissioner because I want to bring a fair deal to Mississippi's insurance ratepayers. As the next insurance commissioner, I will work to stabilize the insurance market and increase competition so we can lower insurance premiums; I will be independent of insurance companies and I will fight for everyday families who insurance rate increases hurt the most."

George Dale of Clinton

Current occupation: Commissioner of Insurance, 1975 to present.

Highest educational degree: Master's degree, Mississippi College.

Personal: Married, five children.

Why I'm running: "For the past 32 years, I have dedicated my life to making sure Mississippi has a viable insurance market. In this time of complex issues, Mississippians need and deserve someone who can help guide them through a very fragile insurance market with the experience and patience that I bring to the office of Commissioner of Insurance."

• Republicans
Mike Chaney of Vicksburg

Current occupation: District 23 state senator, 2000 to present.

Highest educational degree: Bachelor's degree in business-marketing-finance, Mississippi State University, 1966.

Personal: Married, three children.

Why I'm running: "I am running to ensure that all Mississippians have available and affordable insurance and that they received fair treatment from the insurance companies that take their premiums. I will be an advocate for the 2.9 million plus citizens of Mississippi and not any special interest group."

Ronnie D. English of Vancleave

Current occupation: Fire marshal.

Highest educational degree: Attended Mississippi Gulf Coast Community College.

Personal: 63 years old, married, one child.

Why I'm running: "I am running to give the citizens of Mississippi an insurance commissioner that is not controlled or obligated by the insurance industry in Mississippi."


Original article in Sun Herald published July 29, 2007.


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Man burned in FEMA trailer fire

Neighbors said they heard an explosion

Posted on Sun, Jul. 29, 2007
By MICHAEL NEWSOM
mmnewsom@sunherald.com

BILOXI -- A FEMA trailer fire on Motsie Road Saturday caused one heavily burned man to be airlifted to Mobile after the blaze, which destroyed the home.

The fire at the trailer park happened about 8 p.m. after neighbors reported hearing an explosion, said Biloxi's Deputy Fire Chief Kirk Noffsinger. He said one man was severely burned and sent to Mobile, while another suffered illness related to smoke inhalation.

The fire burned very quickly, which is typical of FEMA trailers, Noffsinger said.

"They are a concern," he said. "We're hoping that soon most of these people will get out and be back in their regular residence."
http://www.blogger.com/img/gl.link.gif
He said the fire was intense, and it threatened two other trailers and also one vehicle, but firefighters were able to contain the flames.

He said Saturday it was hard to tell if there actually was an explosion there, and the cause of the fire was unknown. The case is still under investigation.

Original article printed in Sun Herald.

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Mark Fiore Cartoon: Pickling the Poor (FEMA)

	Problems seeing comics? Click here for help.
Pickling by Mark Fiore 7/25/07 Mark Fiore is a San Francisco cartoonist and animator whose work also appears in the Washington Post, L.A. Times and other publications.

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House panel votes to add wind coverage

by Sean Reilly
Mobile Press Register Washington Bureau
Original article published on July 27, 2007.

WASHINGTON -- The House Financial Services Committee agreed Thursday to add optional wind coverage to the National Flood Insurance Program, brushing aside objections that such a major step needed more study.

The bill by U.S. Rep. Maxine Waters, D-Calif., would also increase overall coverage limits, phase out subsidized flood insurance rates for businesses and vacation homes, and authorize spending up to $400 million annually for the next five years to pay for flood map updates.

The subsidized rates generally apply to structures built before the early 1970s. For vacation homes in that category, the bill would allow flood insurance administrators to raise rates by 25 percent annually until the full risk-based premium is reached. For subsidized business structures, rate increases of 20 percent annually would be permitted.

In voting 38-29 to send the bill to the full House, the committee broke largely along party lines, with Democrats solidly in support and most Republicans opposed. In arguing for the addition of wind coverage, Chairman Barney Frank, D-Mass., pointed to the wave of "wind" vs. "water" disputes that followed Hurricane Katrina in 2005.

For full discussion of the famed "wind vs water" argument, see Wind? Water? More Like a Bunch of Hot Air!


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Worries Permitted

JAMES EDWARD BATES/SUN HERALD

Early construction at a home at the intersection of Division St. and Collier St. in Biloxi on Thursday.

Posted on Fri, Jul. 27, 2007

By PRISCILLA FRULLA
pfrulla@sunherald.com

-- It's been a good quarter for several industries, but some of South Mississippi's prominent business leaders are worried Katrina recovery is starting to drag and once-in-a-lifetime opportunities are slipping away.

Concerns that confusion and delays surrounding the building-permitting process may be scaring developers away was a top issue for members of the Sun Herald's Business Roundtable at its quarterly meeting Thursday. Insurance remains an "800-pound gorilla," freezing many projects in place while developers wait to see if costs will come down.

"The situation is different in some cities and counties as opposed to others, but generally speaking, cities and counties Coastwide are still overwhelmed in their inspection departments in handling the volume of commercial and residential planning-review jobs that have come in," said Brian Sanderson, president of the Gulf Coast Business Council.

Sanderson said of the $5 million in grants allocated to help permitting and inspection offices, only 12 percent had been drawn. The council wants to help municipalities make use of this money. It also plans to request an additional $5 million for 48 third-party inspectors and plan reviewers overseen by Gulf Regional Planning Commission to assist the municipalities.

Roundtable members agreed the perceived difficulty in the permitting process of some municipalities is causing developers to re-think investments in the Gulf Coast.

"The two things that run developers off the quickest are inconsistency and unreliability," said Brooks Holstein of Comvest Properties. "If they walk into a city and there is no accessibility and no consistency, they say, 'Life is too short.'

Some municipalities appear to move through the process more efficiently.

"We permitted a Ruby Tuesday in Moss Point in two weeks," said Holstein.

He said getting a permit shouldn't be complex.

"It is simply a decision made by the political leadership," he said. "We have SmartCode to ensure responsible, high-quality development, the International (Building) Code is going to make sure it is built to specifications, you have a stamped set of plans from an architect who is not going to risk his license to build an unstable building and in order to get insurance we have to build a building that will take 150-mph winds."

Pascagoula City Manager Kay Kell said permitting in Jackson County has been streamlined through regular meetings of mayors, city managers and the county administrator.

"We had the same issues that came up and drafted the same ordinances," said Kell, who has offered Pascagoula's building official to help other communities.

"Pascagoula is so much further ahead in recovery, we are willing to be the pilot. We will go out and teach what is working there to other communities," said Kell.

More than a dozen homeowners and builders have complained to the Sun Herald about inefficiency in the permitting and inspection process in municipalities in Hancock and Harrison counties since Hurricane Katrina. None wanted to go on the record with their complaints because they said they feared more delays on their projects.

Community development director Jerry Creel said there is no backlog in Biloxi.

"We are adequately staffed for the construction that has been permitted," said Creel, though he does anticipate an increased need in the future.

Many of the delays in the permitting process are caused by builders or developers not submitting all the required information, said Creel. Unless there are special circumstances that would trigger a public hearing, development permits are issued in 10 to 30 days, he said.

For residential rebuilds, most permits are issued in 10 days, said Creel.

"We really look at three things: Does the site plan comply with the land-development ordinance; do building plans comply with the building codes; and are the contractors who are going to be doing the work licensed to do the work," said Creel.

If the answer is yes to all three questions, the builder should have no problem getting a permit, he said.

Sandy Hill of Gulfport's building and permitting department said she also sees many delays caused by incomplete applications.

"We like to have a turnaround of three days for residential and 10 days for commercial," said Hill. "We like to respond in that time period, but if there is a need for additional comments it goes back to the developer and we have to wait for their response. We can't control the response time back from the developers and contractors."

Hill said the number of applications received has gone from 870 a month before Katrina to 1,500 a month, though the department still has the same number of employees.



© 2007 Sun Herald. All Rights Reserved.
http://www.sunherald.com
Original posted at Sun Herald.

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Federal plan would cover windstorms

A House panel OK'd expanding an insurance program to cover wind damage -- which could bring comfort to Florida residents -- but the plan has Republican critics.
BY MARIA RECIO
mrecio@mcclatchydc.com
(Miami Herald version)
Original published on July 27, 2007.

WASHINGTON --A bill beginning to move through the U.S. House could dramatically change the way windstorm insurance is sold in Florida and other hurricane-prone coastal states.

The House Financial Services Committee voted 38-29 on Thursday to expand the national flood insurance program to cover wind damage. Other proposals floating around Washington would create national catastrophe funds to cover many perils, but this one is focused squarely on hurricane risk.

To be sure, the bill faces stiff opposition ahead -- particularly from Republicans. It could get a floor vote when the House returns from recess in September and, if it passes, would have to prevail in the Senate and get past the White House.
Committee member U.S. Rep. Ron Klein, D-Boca Raton, said he supports the legislation and thinks it would help ease the state's windstorm woes but would not completely solve the insurance crisis.

''This could provide some relief for some people, but I still think we need to take additional steps to reduce insurance costs,'' Klein said.

Read the Miami Herald article.

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With Katrina's Wind at Our Backs, We're Blowing Through Congress!!

by Ana Maria

With a force seemingly more powerful than that of Katrina herself, the House of Representatives Financial Services Committee passed the Flood Insurance Reform and Modernization Act of 2007 keeping in tact the Multiple Peril Insurance Act that had recently been attached to it. In every day language, this means that the Democratically-controlled Congress just took a major step forward in protecting the 55% of Americans who live within 50 miles of the nation’s beautiful coastline. Score one for American families and businesses!


This began nearly two years ago with the insurance companies apparently devising a scheme though which to rip off Mr. and Ms. Home or Business Owners who had just been through the nightmarish Hurricane Katrina with her 22 tornadoes and winds at landfall that were at least 135 miles per hour. Katrina's winds beat down residences and businesses for up to three to four hours. Insurance companies like State Farm, Nationwide, and Allstate directed their agents that if so much as a smidgen of water were on the property to blame all the sustained damage on water.

Those directives and the subsequent documentation on how they were carried out are the foundation for the racketeering (RICO) lawsuit that the Scruggs Katrina Group filed against State Farm and its two corporate partners. [See State Farm, Partners, and RICO: What a Racket! It's another piece I did. You'll love it.]

ABC News was able to obtain a copy from State Farm files of the original FAEC [Forensic Analysis & Engineering Corp.] damage report, which included the image of an attached "Post-it" note that read, "Put in wind file - do not pay bill - do not discuss"

Image at ABC's The Blotter.

The agents for the federal government’s flood insurance program were the very same agents for State Farm, Nationwide, and Allstate and the like. Insurance companies handed down their directives: Do the paper work shuffle, leave your conscience at the door that Katrina blew away, and deliver the bad news to Mr. and Ms Home or Business Owners.

Routinely, the news went something like this.

Mr. and Ms. Homeowner, your wind policy on your homeowner’s insurance won’t pay for any damage. We want to keep to ourselves the $108 billion in profits our industry will make in 2005 and 2006. We have faith that you’ll be ok in spite of our reckless, selfish, irresponsible behavior. We’re greedy bastards who show up religiously at church. We’ll be praying for ya! Do I hear an amen! God bless.

Well, we have been blessed. We have Gulf Coast Representative Gene Taylor (D-MS), a heroic congressman who lost everything in Katrina, whose insurance company screwed over him and his family with failing to pay a penny before resorting to a lawsuit, whose own constituents were experiencing the same level of anguish that he and his family were experiencing.

We are blessed because Congressman Gene Taylor pulled out from the depths of his soul an indefatigable strength to carry on personally and professionally to champion this cause to ensure that America’s families and businesses all over the country never again are exposed to the ravages of corporate greed that has become so apparent in our nation’s insurance industry. To that I say Amen!

President Bill Clinton said something along these lines, “There isn’t anything wrong with America that can’t be made better by what’s right with America.” What is happening with this insurance reform bill is a fantastic example of Clinton’s wise words.

We are blessed because down here in Katrina Land, we reflect the rich tapestry that makes our nation envied the world over. We are of African, European, and Asian descent. We come from Central and South America. Our music is lively and soulful. Our food is hot, strong, and spicy. Our determination to persevere is strong.

To achieve the justice that every home and business owner in America requires in the aftermath of a natural disaster will require that all of us remain determined to persevere through the laborious and slow legislative process that is our form our government.

We can achieve this. The first step is to believe we deserve it. We do deserve it, and now we must embrace that very idea. The second is to believe that it is possible. We have proof that it is. The vote in subcommittee last week—along party lines, I might add, and the vote yesterday—again along party lines with a few conscientious Republicans joining the leadership of every Democrat on the committee. We have achieved step two.

The next step is to take concerted steps in the direction of this legislative dream. You know what that means! It’s political hell raising time. Woohoo! The very next vote will be in the entire chamber of the House of Representatives. It could be as soon as next week before the congress breaks for its August recess. We can say that to achieve our political dreams, we must engage in a bit of political hell raising. What fun!

In the aftermath of Katrina, with the malice of forethought the insurance industry engaged in deceptive practices intent to steal from American home and business owners the benefits that they had paid to have. Through our own political hell raising, we can end the deceptive financial charade of the insurance industry.

We must contact our own congressional representatives and let him or her know that we support the Flood Insurance Reform and Modernization Act of 2007 ESPECIALLY because it includes the Multiple Peril Insurance Act which protects America’s families and businesses.

Sharing our perspective on this critical matter is how we protect our families through expanding the flood insurance program to include wind coverage. Sharing our perspective is how we put a gust of powerful wind under our political sails—and sail into the next round of legislative victories for ourselves, our families, and our businesses.

[Here are political hell raising email and phone activities.]

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TAYLOR'S CRUSADE WINS ONE

Flood program expansion approved by House panel

By MARIA RECIO
SUN HERALD WASHINGTON BUREAU
WASHINGTON -- The House Financial Services Committee voted Thursday to make a dramatic change in federal disaster insurance by expanding the national flood insurance program to cover wind damage.

The 38-29 vote, largely along party lines, in favor of the Flood Insurance Reform and Modernization Act of 2007 was spurred by a pledge House Speaker Nancy Pelosi, D-Calif., made after Hurricane Katrina to the coastal communities of Mississippi and Louisiana.

Pelosi will lead a bipartisan delegation to the region in mid-August before the second anniversary of the hurricane, appearing at Bay St. Louis' Our Lady of the Gulf Catholic Church on Aug. 13.

The vote is a personal victory for Rep. Gene Taylor, D-Bay St. Louis, who lost his home in Katrina. Taylor has made it a crusade to explain to members how the current system creates a shortfall with private insurance companies covering wind damage and the federal government covering water, resulting in a bias by insurers who administer the flood program to label all damage "water."

"This really helps people in all coastal areas," said Taylor, noting residents in North Carolina, Florida, Georgia, Alabama, Maine and New York would be able to purchase the expanded coverage, as well as in his home state of Mississippi. "Fifty percent of all Americans live in coastal areas."

Under the committee-approved bill, policyholders of the flood insurance program would be able to purchase wind insurance policies as well. The policies would not be available for those seeking exclusively wind coverage.

The multiple-peril residential policy limit would be set at $500,000 for the structure and $150,000 for contents. The bill increases the maximum coverage for flood insurance policies from $250,000 to $335,000 for residences.

House Financial Services Committee Chairman Barney Frank, D-Mass., said the expanded program would pay for itself through actuarially determined premiums. "What does it cost (taxpayers)? Nothing," said Frank. "It is revenue neutral." He said the bill was necessary because "in the Gulf situation, it was difficult to tell, if not impossible, wind damage."

The legislation encountered stiff resistance from Republicans who said it exposed the federal government to steep liability at a time when the insurance fund was essentially bankrupt. Insurers and consumer groups are opposed to the expansion, warning losses will dramatically increase as claims rise.

"I am not ready to support shifting the burden of wind damage to a plan that is nearly $18 billion in the red," said Rep. Spencer Bacchus, R-Ala., the committee's ranking Republican. The flood insurance program had to borrow $17.5 billion more than it took in because of Katrina-Rita claims.

The legislation makes reforms in the program, increases premiums, phases out subsidized rates paid by vacation-home owners and raises the borrowing authority.

Republican members offered several amendments stripping or delaying the wind provision from the bill, but they were defeated. Rep. Judy Biggert, R-Ill., who opposed the addition of wind coverage until Congress studies the issue further, complained the controversy could sink the legislation.

"This is really adding a poison pill to flood insurance reform bill," said Biggert. Frank acknowledged the bill was controversial but said it would be ready for a floor vote in September.
Taylor predicted the bill would pass on the House floor and hopes in the Senate he can turn to Senate Minority Whip Trent Lott, R-Miss., who also lost his home to Katrina
Democrats, led by Rep. Maxine Waters, D-Calif., chair of the panel's housing and community opportunity subcommittee, recently attached the language from Taylor's bill on "multiple perils" to the flood insurance reauthorization bill.

But Rep. Jeb Hensarling, R-Texas, questioned whether the plan would stay budget-neutral. "I know from experience that these designs don't always work out the way they're supposed to." He said, "I'm still not convinced the private insurance market won't work."

Rep. Mel Watt, D-N.C., countered that the post-Katrina insurance response "was a massive failure of the private sector. There are still people down there who haven't been paid."

Flood Insurance Reform and Modernization Act of 2007 Here are the key features of H.R. 3121:

• Increases the amount FEMA can raise policy rates in any given year from 10 percent to 15 percent.
• Extends multiple-peril policies for wind damage where local governments agree to adopt and enforce building codes and standards designed to minimize wind damage.
• Allows any community participating in the flood insurance program to opt in to the multiple-peril option. The multiple-peril residential-policy limit is $500,000 for the structure and $150,000 for contents. Nonresidential properties could be covered to $1 million for structure and $750,000 for contents and business interruption.
• Increases the maximum coverage limits for flood insurance policies. New coverage limits would be $335,000 for residences, $135,000 for residential contents, and $670,000 for businesses and churches.
• Phases in actuarial rates for vacation homes and nonresidential properties beginning Jan. 1, 2011.

HOUSE FINANCIAL SERVICES COMMITTEE

Original article at Sun Herald published July 27, 2007.



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