I have again introduced the Multiple Peril Insurance Act, which provides homeowners who purchase federal flood insurance an option to purchase wind insurance. The purpose of the bill is to allow homeowners to buy insurance that will cover hurricane damage without delays or disputes over what was caused by wind and what was caused by water. My legislation, the Multiple Peril Insurance Act, protects American homeowners and American taxpayers against corporate greed and negligence.
When insurance companies like State Farm, Allstate, Nationwide, and USAA refuse to pay on legitimate wind damage claims--like they did after Hurricane Katrina, they also refuse to pay for the cost of living expenses that are part of those homeowner policies. When insurance companies fail to live up to their obligations to their policyholders, American taxpayers step in to help out their fellow citizens. This is extremely generous of the American people. However, expecting taxpayers to foot the bill that should be covered by insurance premiums is unaccepatable because it is simply unfair. These costs should be born out from the premiums that policyholders faithfully pay companies like State Farm, Allstate, Nationwide, USAA, et al.
The Multiple Peril Insurance Act of 2009 is the answer to stopping insurance companies like State Farm, Allstate, Nationwide, USAA, et al. from relying on the American taxpayer to bail them out so that insurance companies can increase their profits and corporate executives can increase bonus pay. This is wrong. The Multiple Peril Insurance Act protects the American homeowner and taxpayer.
In fact, this program would save American taxpayers money by reducing the need for federal government disaster relief payments in the form of FEMA trailers, grants, subsidized loans, tax breaks, and other government assistance, which cost American taxpayers billions of dollars. In the aftermath of Hurricane Katrina, FEMA spent $1.3 billion for FEMA trailers in Mississippi for 43,000 families. We're grateful for each and every one of them. However, I want post-disaster housing to be paid for from the premiums collected rather than impose on American taxpayers generosity. Bailing out insurance companies to protect corporate profit is simply wrong. My legislation, the Multiple Peril Insurance Act, protects American homeowners and protects American taxpayers throughout the nation against corporate greed and negligence.
Lastly, taxpayers do not subsidize the wind insurance or pay any of the costs of this homeowner insurance program. My bill requires the wind option to the flood policy to charge risk-based premiums so that it fully pays for itself. The Congressional Budget Office (CBO) has confirmed that the Multiple Peril Insurance Act does just that.
As Mississippians found out after Hurricane Katrina and our fellow Texans found out in the aftermath of Hurricanes Ike and Gustav, people who have played by the rules and expected homeowner insurance companies to play by the same rules have been screwed. Short of home and business owners hiring lawyers and engineers to take their carriers to court, insurance companies routinely - and deliberately - fail to pay on legitimate hurricane-related wind claims. Passing the Multiple Peril Insurance Act of 2009 will protect America's homeowners and taxpayers against insurance companies that fail to pay on legitimate wind damage claims and sticking those repair and cost-of-living expenses on the American people rather than paying for it out of the premiums collected.