Homeowners' Defense Act of 2007

Floor Speech

HOMEOWNERS' DEFENSE ACT OF 2007 -- (House of Representatives - November 08, 2007)

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Mrs. MALONEY of New York. Mr. Chairman, I rise in support and thank Congressmembers Klein and Mahoney for their leadership.

I have long held the belief that we need solutions to the growing crisis of availability and affordability of homeowner insurance. That is why I was the sponsor of the National Catastrophe Insurance Act in previous congresses, which would have established a Federal reinsurance plan following a disaster with more than $50 billion in insured losses.

Right now we are seeing the consequences of not having these products available. In the wake of a series of devastating hurricanes, large swaths of our country are seeing insurance companies either leaving the market or premiums that are simply too high for homeowners to afford. The legislation before us focuses on stabilizing the catastrophic insurance market by expanding private insurance capacity to cover natural disasters and by helping States better manage risk. This legislation allows States to participate in the plan by allowing their State-sponsored insurance funds to voluntarily pool their catastrophic risk with one another.

The private market, and not taxpayers, will take on the risk through the purchasing of catastrophic bonds and reinsurance contracts. Just as I support other efforts such as TRIA to provide certainty after catastrophic events, I believe it is prudent to put in place a system that insures risk. This allows affected communities and our economy as a whole to respond to each and every disaster in a clear and rational manner while protecting the residents, and I urge my colleagues to support the bill.

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