(CBS4) MIAMI When it comes to natural disasters, you can’t escape mother nature. Whether it’s hurricanes pounding the east coast, floods and tornadoes sweeping through the Midwest, or earthquakes and brushfires wreaking havoc out west, natural disasters affect consumers in the same place: the wallet.
“There's no question that (insurance) costs have gone up”, says Beckam. “The consumer definitely pays.”
The health insurance industry is in a state of flux with rates going through the roof nationally.
Florida plays a major role in the increases due to its geographical location. The Sunshine State boasts about $2 trillion worth of coastal property according to the insurance industry and they expect that number to double by 2014.
It’s because of those industry projections and concerns about possible future bad storms that Florida residents continue to see their rates go up.
One solution to the growing problem may come nationally, in a special session in Tallahassee next week, where officials are expected to push for a nationwide catastrophe fund.
“We need to have a federal catastrophe fund that will deal with either helping us with federal dollars to sell reinsurance or some type of money that comes from the feds” says Rep. Julio Robaina, a Republican who represents District 117.
The fund will provide federally subsidized disaster insurance, which will spread the cost of natural disasters like hurricanes nationwide, rather than just placing them on the backs of Florida property owners.
That’s good news for southeast residents who have not been able to find affordable insurance following Hurricane Katrina’s path of destruction through the gulf coast two years ago.
And it’s not just southern states that are feeling the clamp on their checkbooks. The cost of windstorm policies in the northeast have skyrocketed and in some cases, even cancelled. Florida’s Congressional leaders have heard the cry for affordable insurance and are now taking their fight to Washington.
“We absolutely need to. I'm a co-sponsor of national catastrophe fund legislation,” says democratic Congresswoman Debbie Wasserman-Schultz. “We have natural disasters that occur all over this country -- we have floods, we have earthquakes, we have fire. I mean, you name it, and there's no region of the country that goes untouched by natural disaster.”
Florida property owners are definitely feeling the pinch from disasters in other parts of the country. All property owners are required to pay for Federal Flood Insurance, even though the majority of flooding occurs in the Midwest. One of the snags that may hinder a national catastrophe fund is that the rest of the country may not be willing to pay the price for our natural disasters.
“Politically, it's a tough row to hoe, it really is, “said Wasserman-Schultz. “We have not yet had a hearing, and I don't know that one is scheduled.”
The local plans will try to coordinate non-profit windstorm associations in several coastal states to try and gather the buying power of millions of the residents in hopes of lowering the rates.
Carlos Lacasa of Citizens Insurance thinks coastal states are tired of waiting for federal relief and are prepared to take matters into their own hands. “I think now, more than ever, there's going to be a push, at least for coastal states to come together and create some kind of a program.”
A recent national investigation by the Consumer Federation of America found the potential savings to Florida residents could total billions of dollars a year.
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