In spite of having been hit with the largest natural disaster in U.S. history, a lot of good things are happening in our community. We are seeing major progress on the two main bridges, most casinos are back, employment is up and tax revenues are increasing. However, major issues still confront us, and the number one issue right now is finding available and affordable insurance coverage for our homes and businesses.
Finding a solution to this problem requires us to recognize that there are two different ways to find coverage. The usual way is by going to our insurance agents and purchasing insurance from private insurance companies on the open market.
However, over the years, because of natural disasters, many of us have been driven to use coverage written through our State Wind Pool in which coverages are written by the same company, but at State regulated rates. Unfortunately, because a number of private companies are no longer writing coverages in certain areas of the Coast, the Wind Pool has become our only resort.
Because many of us have been forced into the Pool, the insured value of properties underwritten by the Pool has sky rocketed. The result has been a large increase in reinsurance cost for the Pool, and a resulting increase in premiums.
The overall solution to this complicated dilemma is to find ways to encourage companies to write coverage outside of the Wind Pool. That would lead to the availability of insurance coverage as it existed pre-Katrina and also would result in billions of dollars of less coverage that has to be carried by our State-run Pool. Once that occurs, the premiums for policies covered by the Pool will dramatically fall.
We are developing legislation which provides incentives to encourage insurance companies to once again write coverage in all areas of the State at reasonable rates. The legislative process, will be difficult because there is no uniformity of thought as how to solve this problem. We will continue to need the support of not only the people of the Gulf Coast, but of all Mississippians.
We must remember that difficult times remain ahead of us, and as we go through them we should all recall the lines written by Robert Fulghum who reminded us that when we were school kids going on field trips, we were cautioned by our teachers that when crossing streets we should hold hands and look out for one another. If we do that, we will overcome these problems.