Lawmakers seek out answers concerning troubling insurance trends
Mississippi lawmakers may soon pass legislation that will require the state’s property insurance companies to disclose how much they collect in premiums and how much money they spend on claims. This legislation would target insurers that provide coverage for the damage associated with hurricanes. Most insurance companies only provide coverage for wind damage, as flood insurance is primarily a matter for the federal government to handle. State officials suggest that insurers are not always straightforward with the information they provide concerning damage caused by hurricanes.
Bills seek to make homeowners insurance more transparent
House Bill 753 and House Bill 756 have won the approval of Mississippi’s House Insurance Committee. The first bill is meant to determine what areas of the state insurers provide wind coverage for and what areas of the state these companies are avoiding. Natural disasters can be a costly matter for insurance companies and, at times, homeowners insurance providers attempt to mitigate their financial risk by not offering coverage in risk-prone areas. The second bill is meant to regulate hurricane deductibles in order to provide some financial security to homeowners.
Insurers may be charging too much for coverage in some parts of the state
Lawmakers are concerned that homeowners are paying more for coverage than they are getting back in claims. Insurance companies note that providing coverage to coastal properties is a risky matter, especially in states that are prone to heavy rainfall and strong windstorms. Natural disasters can cause significant damage to property, which in turn has a financial impact on insurance companies. Lawmakers suggest, however, that insurers are charging too much for coverage that has not been used in several years.
Legislation may help lawmakers and consumers better understand insurance coverage
Mississippi lawmakers are keen to find out why some insurance companies refuse to provide coverage for wind damage as well. Many homeowners are forced to purchase wind protection from the Mississippi Windstorm Underwriting Association, which is sponsored by the state itself. New legislation may help shed some light on the matter, though whether insurance companies will opt to expand their coverage in the future is impossible to determine for sure.