Governor Bentley's Affordable Homeowners Insurance Commission -  HHII & Media Commentary

HHII Involvement & Concerns

Media Commentary & Opinion


The HHII video showing commissioners debating their responsibilities has been watched by more than 500 viewers and generated a lot of interest.  WKRG interviewed Judge Russell & HHII members today (10/2/2012) on channel 5.  A link to this will be posted as soon as WKRG makes it available.

Another AHIC exchange which took place in December 2011 and failed to get adequate public exposure was captured by HHII on a video about the hurricane catastrophe models that created our mess in 2006. One of the two individuals on the video is the inventer of the models, who argues that they are not accurate.

View both these videos yourself and encourage all your friends, neighbors, and everyone on your email list to become informed by viewing them, along with HHII's PowerPoint presentation on the facts about coastal Alabama's homeowners' insurance crisis.

Updated 10/3/2012


The following letter was sent to Governor Bentley's office by an HHII member after viewing HHII's video of AHIC Commissioners mocking the idea of solving the coastal insurance crisis.  Have you written to let him know what YOU think of the Commission's efforts?

This is in reference to the video of the Alabama Coastal Wind Insurance Commission meeting at which Ms. Julie McGhee, Revenue Commissioner, spoke on behalf of the Governor: "If we were solving the problem, we would be the only state in the nation solving the problem (she chuckles)." She adds further that she has been an insurance agent for twenty-two years and it took a long time to get where we are now and will take a long time to change it. Her negative statements shut down further positive discussion. Ms. McGhee's statements on the video, as well as others on the Commission, did not respect the challenge the Governor gave a year earlier, when he asked the Commission to "work together to find a reasonable solution." Ms. McGhee stated that she has had many discussions with the Governor and that she understands that change in the current wind insurance crisis on the coast will take a long time because Governor Riley could not solve it (in my opinion Governor Riley's attempts were lip service only; he never made sincere efforts to "solve" the problem). Ms. McGhee speaks as though she advised rather than listening to Governor Bentley; she puts words in his mouth. Some other Commission members are as negative as Ms. McGhee in the video. In opposition to Ms. McGhee's big insurance rhetoric, I think Alabama should lead the nation in solving the wind insurance crisis on the coast. Alabama has a good start with solid proposals from people who have studied the issue for several years.

There are people in my neighborhood in Orange Beach, who don't have wind insurance because they cannot afford to purchase it. I live in a neighborhood of mostly permanent residents, who work here. People all over Baldwin County do not have wind insurance. As the Governor said a year ago, there are solutions for problems. We just have to be brave enough, tenatious enough, and flexible enough to find solutions. Get the people off the Commission, who are negative about the challenge they were given. Move forward with proposals from HHII.

Posted 9/25/2012


All three recommendations in the above report have some merit but do nothing to reduce premiums in the short term, prevent arbitrary loss of coverage, or address perceived inequities in premiums charged for different locations.

*  Folks who cannot afford to pay their insurance premiums are unlikely to be able to accumulate a catastrophic savings account and, if they could, the tax savings would be miniscule.

*  By definition, extending reinforcement discounts to the whole state (if, in fact, they are granted) offers no additional benefit to coastal homeowners. The only benefactors are the insurance companies, who may lose some premium income, but more than offset that with significantly reduced risk exposure.

* The captive insurance plan (a pet of Rep. Faust) offers the best prospect of premium reduction in the foreseeable future but the devil is in the details. Unless a reliable long term funding mechanism, not dependent on levies after a catastrophe, is put in place Alabama will end up like Florida's Citizen's plan.

On the clarity bill, the compromise not to require aggregate premiums by zip code to be further broken down by risk category seems reasonable.

 Posted 3/27/2012


Before the coast can expect the rest of the state to support a solution, coastal Alabama residents must develop a clear understanding of what fixes the problem and then universally back our legislators -- of both parties -- as they wrestle the solution into place.  A unified demand for fair treatment out of the Alabama Department of Insurance is necessary. They know we have a crisis.  We can quit talking about that.  We must all speak with one voice about what fixes it.  At this moment media coverage regarding solutions has been dismal.  If you would like a list of 24 proposed solutions -- only 3 of which might have significant impact -- email to obtain a "Grading the Solutions" grid.

Updated 2/27/2012


As noted in earlier posts, Governor Bentley's Affordable Homeowners Insurance Commission meeting scheduled for Monday, January 30th, has been delayed again (it is now rescheduled for Friday, February 10).  The Commission hasn't met since December 12th.  One of the scheduled expert speakers could not attend and several members of the Commission indicated they would also not be able to attend.

The dedication of several of the members of this Commission has always been questionable and they have been heard to say on more than one occasion say that this was an unpaid appointment and they didn't have time to do much.

The Agenda Committee, effectively chaired by HHII's Michelle Kurtz and faithfully attended by Aubrey Fuller, had developed a plan for Monday's meeting that would fill two days without a single speaker.  For example, to date, the Commission has not finalized a clear definition of the problem. Very significantly, there are also numerous questions that need to be asked of past speakers and the points they made.  That alone could take a day, if done right.  THEN comes the time of actually laying out proposed solutions and deliberating on them.  Just collecting the list of proposed solutions from Commission members, would take most of a day. But, to date, the recent work of the Agenda Commmittee remains unaknowledged by the Commission Chairman. 

Two insurance industry members of the Agenda Committee have essentially boycotted its meetings, one saying its work went beyond the responsibilities of an agenda committee and the other saying he agreed.  In one instance Michelle suggested 12(!) time slots over several days, asking them to pick one. In another instance she offered 6.  But they failed to cooperate.

Nor did they resign so others who were willing to work could be appointed.

Thus-boycotting the Agenda Committee created tensions. In one instance it prohibited quorum. This has inclined the powers to be to honor those who thwarted work rather than those who continued to do the work.

The collapse of the long-scheduled January meeting in Montgomery can be laid at their feet -- and the feet of those in charge, like Governor Bentley. Even though one speaker could not attend the January 30 meeting, another could.  More importantly, there is a ton of catch-up questioning and definition needed.  The Agenda Committee has laid out ways to move forward in a diligent and good-faith process, but the work of those who worked was ignored.

The collapse of the January 30th meeting is symptomatic of Governor Bentley's Commission as thus-designed. If Governor Bentley is serious about fixing the problem, he should seek the resignation of those who don't work, or who view a steady frequent pace too inconvenient, and honor those who have worked hard.  He should also give Michelle some additional support on the Commission by allowing her experts full participation. The insurance industry is allowed to have a lawyer participate fully, a lobbyist, and a dozen agents and others directly tied to the industry; Michelle is allowed no one.

Of course, if the Commission collapses or fails in other ways . . . who does that serve best?  The Consumer or the Insurance Industry?

Is it time to start shining the light . . . ?

Bring your ideas and suggestions to the next HHII meeting near you or leave a comment on HHII's Discussion Forum at 'Next Steps for HHII'.

Posted 1/31/2012


A fellow member of Governor Bentley's Affordable Homeowners Insurance Commission has referred to efforts by Michelle Kurtz to focus the agenda,  as "silly emails" and "snippy."  Kurtz represents HHII, the Homeowners Hurricane Insurance Initiative on the Commission. The remarks were made by her co-chariman on the Agenda Committee.

As a former Presbyterian Missionary with a masters degree that prepared her well for developing strong deliberative processes, she has struggled to get the Agenda Committee to meet the number of times necessary to help the Commission create a healthy problem-solving process.

Two prior governors' commissions have failed to fix the coastal insurance problem, and some HHII members believe unhealthy process played a role in their failure.

Kurtz has struggled,to have the Commission establish intentional time at the beginning of its study to clearly define the insurance problem.  In conversations outside the Commission individuals in the past have said the problem is that coastal residents don't know how to shop for insurance or that they made poor choices moving to Mobile or Baldwin counties. Kurtz was successful in getting the Commission to take deliberative time and a first step toward clearly defining the problem, but has not been successful yet getting them to refine the statement. 

She has also tried to get the Commission to take intentional time to sort facts from opinions before it begins deliberating on solutions. To date she has not been successful. Nor has she been successful getting the Commission to agree to explicitly discuss how its proposed solutions will fix the coastal insurance problem. (And to record the results of that discussion in its minutes.)

HHII's steering committee has been privy to all Michelle's communications and not once has she been "snippy" nor has she worked in a way that could be accurately called "silly."

Posted 11/20/2011


The Affordable Homeowners Insurance Commission (AHIC) is having an education session for the commissioners on Monday, November 7th. This would be great information for you right from the Department of Insurance and Senator Ben Brooks. Citizens can observe and if you want to join us you can either organize a van pool (HHII is unable to provide transportation) or you can view the sessions live by means of U-Stream on your computer. You will need an internet connection. We will send out the link later in the week.

The AHIC is in process of calling experts to present at this session. HHII wants Karen Clark to present because she challenges the accuracy of the Catastrophe models. At this point in time, the AL DOI does not want her to present. WHY?  View Karen Clark's Presentation on Model Limitations & click here to read more about hurricane risk modeling and its limitations

It is possible for this commission to do its work and no one would ever know. The struggles of the only church based citizen's group on a commission with a majority of its members coming right out of the insurance industry is not being fully reported in the papers. The newspaper reports miss the debates, issues and tension points in the commission's deliberation. You need to judge if this commission is serving the Governor and YOU. By coming to this session, you will learn the basic vocabulary of insurance and why your premiums are going up. Your HHII representative on the commission will share with you what is happening and we will discuss how you can respond to the work of the commission. You can have a great influence on this commission. Don't stay home!!

Posted 10/30/2011


The Governor's newly-appointed Affordable Insurance Commission is covered up with insurance company interests. More than half the 27 members are directly tied to the insurance industry. The consumer is barely visible. Maybe this governor's commission (this is the third governor's commission) will fix our crisis.  Maybe not.  One of the best ways to push for honest solutions is for the public to watch every move.

Revised 9/18/2011


 Michelle Kirtz of HHII at first meeting of Affordable Homeowners Insurance Commission

Thirty-five people from Mobile and Baldwin counties rode HHII-provided church buses and cars to Montgomery for the first meeting. Two people from BISCO, a south Louisiana organization of church-based community-improvement organizations affiliated with HHII attended, too. Their presence illustrated that a smattering of national interest has begun to focus on this commission. Insurance companies have suddenly begun doing things similar to what they’re doing to Alabama’s coastal counties to coastal counties from the Mexican border to Massachusetts.

Read official minutes of meeting here
Read HHII's view of the meeting here

Revised 8/22/2011


The first session of the Alabama Governor's insurance commission met yesterday and we saw little lights of hope.
There were 37 from HHII & two representatives from our sister organization in Louisiana - BISCO!!!  We made a big difference!  Stan Virden was able to make a short speech on the floor.
Governor Bentley repeated at least four times that we must “solve” this insurance problem – not address, not study – but SOLVE. That is a good start.

And the chair of the commission is promoting a State captive or some sort of mechanism for homeowners and another captive as a way to do reinsurance.

So, nothing definite, but an indication that there MIGHT be a better atmosphere than ever before to consider new ideas. Plus, US Representative Bonner for the State of Alabama wants to explore solutions at the Federal level. HHII is very hopeful.

Updated 8/8/2011

HHII News Release

For immediate release – July 9, 2011

Representatives of the Homeowners Hurricane Insurance Initiative (HHII), the faith-based, grassroots political group that has fought for more affordable property insurance, today thanked the Governor for appointing one of their members, Michelle Kurtz, to the Governor’s Commission on Insurance.

HHII had been promised representation when it met with the Governor on Feb. 16, Janssen said and we are grateful to be able to serve.

“In Baldwin and Mobile counties, at least 52 thousand homes are now without wind and hail protection because insurance companies have been allowed to simply walk away from this protection while dramatically raising rates in coastal counties for fire and theft insurance, said Janssen. After the disaster up north with the tornados we want to be double sure we work together for lasting solutions.

“Voters are tired of being prey for wealthy insurance interests,” he said.

“In the past, most appointees to insurance commissions have been foxes in the homeowner henhouse. Although outnumbered and outspent, HHII will fight to assure the Commission serves citizens, not lobbyists” said Janssen.”

“The insurance industry lobby has been able to distinguish itself as the only business, except baseball, without the consumer protections of federal anti-trust laws. They can legally collude to set prices and selling conditions. HHII will endeavor to work so that insurance returns to its original vocational calling in society – to provide a future and a hope!” Janssen said.

Janssen stressed that the efforts of the homeowners group are aimed at reducing premiums of all Alabamians, significant reduction of premiums, a sustainable solution, which includes mitigation and just payment of claims.

“Increasingly, minorities, the poor and the middle class are forced out of the home ownership market because of unjustified insurance cancellations driven by greed and/or an incompetent business models,” he said.

“In particular, the poor, working poor and middle class are threatened. Soon, only the uninsured wealthy who can afford to lose their homes to fire, flood or tornados will live in these areas of Alabama. This is an unacceptable disruption in the Alabama economy that must be addressed in the Governor’s upcoming special session on insurance reform.

“Unless the excesses of the virtually unregulated insurance factions are mitigated by legislative action, jobs in our state soon will be in even bigger trouble than they are now.

“Already, we have seen the unfair pricing heaped on Alabama homeowners on the coast, with premium increases often quadrupling over only a few years. This can’t continue to accelerate and we would hate to see this happen to the tornado survivors,” Janssen said.

HHII goals are significant reduction of premiums, a sustainable solution and just payment of claims.

 Posted 7/9/2011


BP has agreed to plead guilty to 11 felony counts of Misconduct or Neglect of Ships Officers relating to the loss of 11 lives; one misdemeanor count under the Clean Water Act (CWA); one misdemeanor count under the Migratory Bird Treaty Act; and one felony count of obstruction of Congress but BP still faces a civil trial that could see it once again fined, this time for each barrel of oil that gushed into Gulf waters for months.

The government intends to vigorously pursue its civil claims that BP committed 'gross negligence' in allowing some 5,000,000 barrels of oil to pour into the Gulf.   If proven, BP could face up to $20 billion in fines under the CWA, although the final sum could be smaller after negotiations, perhaps in the $10 billion range.  If a negotiated settlement cannot be reached, the case will go to trial in New Orleans in February, 2013.

Posted 11/20/2012

BP Close to Spill Settlement

Based on article by Daniel Gilbert in 10/11/2012 WSJ

BP PLC and the US Justice Department are close to a settlement which would resolve BP's biggest remaining liability from the 2010 Deepwater Horizon disaster which triggered the worst offshore oil spill in US history.

At stake are billions of dollars that would flow to five coastal states affected by the spill.  Among key points of contention are the degree to which BP was negligent, which determines the scale of damages, and which laws the government uses to assess penalties, which determines where the money flows and how it is spent. 

Damages awarded under the Clean Water Act (CWA) can cover economic losses but those imposed under the Oil Pollution Act (OPA) must be used for environmental remediation.  Congress has guaranteed that 80% of fines under the CWA, estimated to be between $5.4 & $21 billion, would flow to the states, while the federal government has greater control of OPA funds.

Lawmakers from AL, TX, MS & FL signed a letter last week to AG Eric Holder objecting to a settlement "that disproportionately applies penalties" through the OPA over the CWA.  AL will use its share of the money to create the Restore Fund which is being cited as a funding source for mitigation efforts recommended in the AHIC Report.

Posted 10/13/2012

Insurance proposals stall in Montgomery

From 4/12/2012 post by George Altman, Capital Bureau

Time is running short for property insurance bills, with the 2012 regular session past the halfway point and nearly every insurance proposal still far from becoming law.

That changed little on Wednesday (4/11/2012), despite three different panels in the state capital discussing insurance issues for a combined four hours. Only one of the groups, the Senate Banking and Insurance Committee, approved any specific proposals, and that panel agreed to support only one bill. The House Insurance Committee was scheduled to consider two insurance proposals from Rep. Steve McMillan, R-Gulf Shores, but did not vote on either of them.

The third panel, the Affordable Homeowners Insurance Commission, created by the governor, did not vote on any proposals and had devolved into a bitter argument by the end of the meeting.

"I have come to the conclusion that the only way that Alabama is going to pass the majority of the insurance reform package is in a special session," said Sen. Ben Brooks, R-Mobile. Brooks added that he is working to get a few insurance bills passed in the current regular session. But "it’s very frustrating, very frustrating, to see the influence that industry has."

Lawmakers, particularly from south Alabama, have worked for years to pass bills that can address a lack of insurance availability and affordability in the wake of Hurricanes Ivan and Katrina. They have found limited success, in the face of opposition from the insurance industry and lawmakers from north and central Alabama.

Last month, the commission approved a handful of proposals and made plans to hold more votes at Wednesday’s meeting. But members of the Homeowners Hurricane Insurance Initiative asked that the votes be delayed. 

Michelle Kurtz, HHII’s representative on the panel, said that the group had too many insurance industry officials and too few consumer advocates. Several of the non-industry commission members have stopped coming to meetings, she added, calling on Bentley to add more consumer voices to the panel.  "Right now, the public highly suspects what comes out of this (group), and that’s the truth. You can read the blogs," Kurtz said during the meeting.

"Well, you can believe whatever you put on the blogs. That’s your opinion," said Geoff Plott, an independent insurance agent from Tuscaloosa also on the commission.

The meeting ended with some members fighting back tears, some angry and most agreeing to break into smaller groups to further discuss particular aspects of insurance reform.

Read complete post

posted 4/13/2012

Bentley has yet to deliver on promise
to address homeowners' insurance rates

From 3/25/2012 article by Phillip Rawls of the AP Montgomery bureau

Gov. Robert Bentley has not yet kept a campaign promise he made in 2010 to have the Legislature address the rising cost and declining availability of homeowners' insurance in Alabama. Almost a year has passed since he announced the creation of a commission to study the insurance issue, and he's still waiting on the group's recommendations. "The governor did not expect the process to take this long, but recognizes that this is a very complicated issue, and decisions must be made carefully," the governor's press secretary, Jennifer Ardis, said Friday.

A member of the governor's Affordable Homeowners Insurance Commission said he's hopeful the commission will give recommendations to the governor shortly after the next hurricane season starts June 1 and Bentley could schedule a special session of the Legislature in August or September. "Those on the coast are expecting the governor to stand by his commitment to call a special session. He voiced that during the campaign," said Republican Sen. Ben Brooks of Mobile, who serves on the governor's commission.

"The governor has promised us a special session," said Baldwin County Probate Judge Tim Russell, the commission's chairman. Commission members said it's taken a long time because the commission is large, with 30 members. It's a diverse group, with some members more knowledgeable about the insurance business than others. Consumer and insurance interests on the panel also differ on what should be done. "We didn't have enough consensus to bring legislation together because it's such a diverse group," Russell said.

People watching the commission say there's another reason. It has lots of insurance industry members, including some who don't want more government involvement in their business.

"We're not real high on these commissions, especially when you stack them with insurance people," said Dan Hanson, a spokesman for the Homeowners' Hurricane Insurance Initiative.

Geoff Plott, a commercial insurance agent from Tuscaloosa who serves on the commission, said consumers want cheap rates with a low deductible issued by a financially strong company, and that is not realistic in state that has a reputation for being a tough market for homeowners' insurance. He said there are no quick, easy fixes.

Bentley's state insurance commissioner, who serves on the panel, said some ideas presented to the panel are out of the question. "What the people on the coast want is for me and the governor to cut their rates and raise the rates for everybody else in the state. I don't have the ability to do that, and I don't think the governor does," Commissioner Jim Ridling said.

Commission members say it's likely to take a couple more meetings to finish a report, and it may focus on long-term goals. Some say stronger building codes and making existing homes more wind resistant will help in a state that a recent insurance industry study ranked as 15th among the 18 hurricane-prone states for building standards and enforcement practices. "Stronger building codes lower insurance costs for homeowners and will encourage private markets to write more policies. More competition from insurance companies will help stabilize insurance rates," Plott said.

The governor's press secretary said that once the commission completes its work, the governor will work with legislators to decide whether issues will be better addressed in a special session or regular session. The next regular session will start in February 2013. Republican Rep. Steve McMillan of Bay Minette, who serves on the commission, said there is no need for the governor to call a special session without a consensus because nothing would pass and the state would waste money.

 Read complete article

Posted 3/26/2012 (Hat tip to Al Carlson)

Insurance industry touts statewide building codes for Alabama

From 2/15/2012 MPR article by George Altman

The creation of statewide building codes in Alabama is key to solving the state’s property insurance woes and a top priority, the Property Casualty Insurers Association of America group said Tuesday, but the idea is far from passing the Legislature this session.

The group remains opposed to a proposal that would force insurers to publicly disclose -- in a statewide database, searchable by ZIP code -- how many policies they write, how much they charge for premiums and what losses they incur.  That legislation is a top priority for south Alabama lawmakers and grassroots insurance overhaul supporters.

"Not all insurance companies gather information by ZIP code, necessarily. They may have their own, individual rating territory," said Chris Hackett, the group’s director of personal lines policy. He added that such a requirement would be "onerous."

Asked whether the industry group would support the proposal if its requirements were relaxed to allow reporting by such rating territories, Hackett said insurers would likely remain opposed.  "To us, it’s unclear what the information is going to be used for, and if they’re really trying to get at consumer education, there’s better ways to do that," Hackett said.

 Rep. Steve McMillan, R-Gulf Shores, was unmoved. "We’ve heard all of that crying before," McMillan said.

McMillan and other supporters of the so-called clarity bill have questioned whether south Alabama residents are being forced to pay rates so high that they effectively subsidize coverage for the rest of the state.

"I think, when the clarity bill passes, we’re going to see a major unfair charging of the coast as compared to the damage that’s actually done," said Dan Hanson, a leader with the grassroots south Alabama interest group Homeowners Hurricane Insurance Initiative.

Hanson expressed conditional support for statewide building codes, saying that while the idea has merit, he is concerned about the potential impact of such requirements on the poor, and he doubts whether insurers would lower premiums for more storm-resistant buildings.

 Read complete article

Posted 2/18/2012


The Property Casualty Insurers Association of America (PCI) has recently submitted a report titled 'Natural Catastrophes Create a Fragile Homeowners Insurance Market in Alabama' to AHIC members outlining legislative reforms designed to lower disaster costs, help consumers prepare for catastrophe losses and promote the availability and affordability of homeowners coverage.  Their recommendations include:

o Implement and enforce a uniform statewide building code with wind-design requirements for new construction.

o Establish income tax deductions on “catastrophe savings accounts” for homeowners to set aside policy deductibles.

o Provide state income tax deductions on sales tax spent on materials to retro-fit properties.

o Combat insurance fraud by enacting insurance fraud legislation.

o Permit insurers to recoup assessments paid to the state’s Beach Plan

o Modernize the state’s rate regulatory system from prior approval to flex-rating to ensure greater price stability and a stronger competitive market.

o Provide income tax deductions for consumers whose homeowners insurance premiums are greater than 5 percent of their adjusted gross income.

The Property Casualty Insurers Association of America (PCI) is a trade association consisting of more than 1,000 insurers of all sizes and types. PCI members represent 38.3 percent of the total general insurance business and 31.6 percent of the total homeowners business in the nation. In Alabama, PCI members represent 32.8 percent of the homeowners market.

Not surprisingly, their recommendations primarily stress risk mitigation and less regulatory interference.  The preponderance of insurance industry representatives on the commission will likely ensure these recommendations are adopted.  Although they may in the long term indirectly reduce premiums, none address rate inequities or help solve the current lack of affordable coverage.

Read the complete report and express your opinion on the HHII Forum

Posted 2/4/2012

Gov. Robert Bentley's insurance commission:
Legislation better late than never

Alabama Homeowners Insurance Commission is currently in "education phase," package of bills could be presented in regular session

Members of Gov. Robert Bentley’s Affordable Homeowners Insurance Commission are still optimistic about solving the state’s epidemic of skyrocketing premiums and dropped policies, even if it takes a few months longer than expected. Originally hoping to convene in a special session in December or January, it’s more likely the commission won’t be prepared until the next regularly scheduled legislative session begins Feb. 7.

But State Sen. Ben Brooks and Rep. Steve McMillan, two of nearly 30 people who have been actively engaged in the commission since its inception in April, said a package of bills already exists that could be presented to a special session if necessary. Yet both would prefer to wait until the commission’s work is complete and a handful of additional bills were drafted to strengthen the package. “We have a bill now that deals with matters of transparency, a bill that mandates the restructure of the state wind pool, and one that provides incentives for increased availability and affordability of insurance,” Brooks said. “But other ideas are on table that would address how deductibles are handled, would provide funding for grants to retrofit homes, could create a new class of policies, or possibly promote a regional interstate cooperative.”

The commission sought initial public comment from an overflow crowd in Mobile Aug. 29 before moving to sparsely-attended forums in Dothan, Decatur, Tuscaloosa and Guntersville. The education phase began in Montgomery Nov. 7 with an “Insurance 101” presentation from State Insurance Commissioner Jim Ridley and a legislative update from Brooks. There are two more education meetings scheduled Nov. 21 and Dec. 12 which will discuss a state-backed loan program, reinsurance and risk modeling, among other things.

Reportedly, a few commissioners, those who aren’t elected officials or employees of the insurance industry, are seeking additional education sessions, citing the complexity of the issues. “We are in an education phase now to make sure that everyone is up to speed, but time is becoming a consideration,” McMillan said. “Frankly, I was disappointed with the public participation at the meetings in the northern part of the state, and maybe some of those meetings were unnecessary, but soon it’s going to be time to start working on something substantive.”

Rep. Joe Faust, also a member of the commission, is pushing for a captive insurance option, which would allow individual counties to apply for coverage. “I’ve been dealing with this for five years so these education meetings are very boring to me,” he said. “I appreciate sharing that information with everyone else, but it’s time to quit cutting bait and get to fishing.”

Dan Hanson, who along with commission member Michelle Kurtz is a consumer advocate with the Homeowners Hurricane Insurance Initiative, said that if the commission isn’t thorough, it will fail. “I know we can’t put this off for another year but we want to take the time needed to find the proper solutions,” Hanson said. “Consumer representatives are at an extreme disadvantage and we are constantly being reminded that every commissioner is serving on a volunteer basis. But if they don’t have the time to spend on it then maybe they shouldn’t have volunteered to begin with.”

Hanson argues that despite public perception, high premiums along the coast are a statewide problem that will require sacrifices from each and every county. “Sixty-five of 67 counties in the state declared states of emergency after Hurricane Ivan, yet we only saw that exponential rise in deductibles along the coast,” he said. “We’ve got substantial evidence that risk models that were used after Hurricane Ivan under-reported damage upstate as much as 400 percent. So they are in this too.” “I don’t know if it was productive for us to hold the listening sessions in some parts of the state that aren’t dealing with the same issues we are on the coast,” he said.

In the meantime, commissioners are convening in a series of “education meetings,” which are meant to make sure everyone is up-to-speed on issue.

State Rep. Steve McMillian, who serves on the commission along with about 30 other people from around the state, said he would propose five citizen forums.

Posted 11/19/2011

Governor's insurance reform commission meeting in Mobile

From 8/29/2011 article

Dan Hanson of the grassroots organization Homeowners Hurricane Insurance Initiative said the goal of the August 29 meeting would be two-fold.

“We need to first of all define the problem, so every member of this commission understands what’s unfair and unreasonable about the current insurance situation,” Hanson said. “We also want them to understand that from our point of view, if they fail to lower premiums and get them in line with the rest of the state or other coastal areas, they have failed as a commission.”

Hanson said ultimately, he would like to see the commission endorse the Property Insurance Clarity Bill, which the legislature could pass in a special session. The bill would require the insurers to be more transparent by providing data about policies and premiums written in the state and actuary and risk calculation information.

“We should not be forced to subsidize the rest of the state,” Hanson said. “We’ve always been here and hurricanes have always been here so we’re not convinced the difference is justified.”

Hanson said the HHII has met with nearly 4,000 people at community meetings during the last two years.

Posted 9/3/2011

National Association of Mutual Insurance Companies expressed its support

By Diana Rosenberg, senior associate editor, BestWeek

MONTGOMERY, Ala. April 07 (BestWire) — Alabama Gov. Robert Bentley signed an order to create a commission to study the cost of homeowners' insurance for people living in coastal areas.

Seven individuals, who have yet to be named, will serve on the Coastal Insurance Commission, to make recommendations how to make homeowners' insurance more "affordable and comprehensive," according to the governor's order.

"We hope that out of this commission will come definitive action," said Michelle Kurtz, community consultant for the Homeowners' Hurricane Insurance Initiative, a group of residents in the coastal counties of Mobile and Baldwin.

Kurtz said the organization wasn't looking for another commission, noting there previously have been two others, with plenty of studies and "lots of great ideas."

The Homeowners' Hurricane Insurance Initiative, whose members have served on previous panels, hasn't been contacted by the governor's office about the new one, she said. The group's steering board will meet in the coming days to discuss whether to volunteer.

The group, which is sponsored by the Baldwin Churches Community Organization, supports legislation, SB 2, known as the Property Insurance Clarity Act, which would require insurance companies to provide policy and premium information, including the number of policies written, direct earned premiums and direct incurred losses, to the department of insurance. When Bentley ran for governor, he promised the group he would support the bill, Kurtz said.

The National Association of Mutual Insurance Companies expressed its support."We believe the commission should focus on a balanced, free-market approach, with emphasis on long-term solutions that benefit individuals and communities," Liz Reynolds, state affairs manager for the Southeast for NAMIC, said in a statement. "Risk-based pricing, actuarially sound rates, and loss mitigation should be the core of any proposed solution. Any reforms to the current regulatory system should have the objective of attracting capital, not scaring it away."

The companies with the largest market share in the Alabama homeowners multiperil market in 2009 were State Farm Group, with a 26.14% market share; Alfa Insurance Group, with a 19.14% share; Allstate Insurance Group, with a 10.8% share; Farmers Insurance Group, with a 9.12% share; and Travelers Group, with a 5.63% share, according to BestLink, which provides online access to A.M. Best's database of insurance information.

Posted 4/12/2011

Bring everybody to the table on insurance issue

The Press-Register's 4/10/2011 editorial disappoints in its support of yet another commission to study coastal insurance.  No mention is made of bringing HHII to the table and none of the solutions proposed will achieve the most important goal of bringing about significant reduction in premiums NOW.

Read PR editorial

Posted 4/11/2011

This page last updated 11/20/2012