California Insurance Commissioner John Garamendi took a boldstep last year to alert America that as a nation we are not asprepared as we should be for the consequences of catastrophe.

The step the commissioner took to convene a summit of thenation's insurance regulators, for the purpose of preparing for andprotecting America from disaster losses, came at a critical momentas the threat of catastrophic events continues to rise.

The fact that Mr. Garamendi was joined by top regulators fromNew York, Florida and Illinois underscores the nationwide concernand acknowledges that catastrophes are not contained and isolatedevents. These policymakers question whether we will have themechanisms in place to enable families to be prepared for andprotected from catastrophes when they strike.

A new coalition of first responders, emergency personnel,building code experts, insurers and others began calling for thecreation of a privately funded national catastrophe fund evenbefore the onset of the devastating hurricane season of 2005.

The members of this coalition–ProtectingAmerica.org–applaud thevision and leadership of these insurance regulators from across thecountry.

The national economic impact of catastrophes is shouldered notby the residents of individual states, but by all Americans.Earthquake faults run all along the West Coast and throughout theMidwest, while hurricanes run throughout the Gulf and easternshores. Had state, local and federal officials paid closerattention to preparing for natural disasters, the consequences fromthe 2005 hurricane season might have been less tragic.

As California marks the 100th anniversary of the GreatEarthquake of 1906, it is worth noting that if an earthquake strucktoday at the same location with the same magnitude as that of onlya century ago, the likely economic losses are estimated to exceed$400 billion. Financial recovery in the wake of such a catastrophicevent would be an unrivaled national economic challenge for ourfamilies, our communities and our nation.

San Francisco's experience in 1906 is thought by many Americansas the largest of all earthquakes to hit the United States, but thefact is that San Francisco's earthquake doesn't even rank in thetop-10 strongest in U.S. history.

Eight of the top-10 U.S. earthquakes occurred in remote parts ofAlaska, but two enormous earthquakes occurred along the New MadridFault, right in the middle of our nation, in 1810 and 1811. Had theRichter Scale been in use at the time, these quakes would haveregistered an eight. Their tremors were felt from Mississippi toMichigan, from Pennsylvania to Nebraska.

When the New Madrid series of earthquakes struck, our heartlandwas vast and uninhabited. Were either of the New Madrid quakes tooccur today, the damage would be enormous.

The point is, catastrophes can strike anywhere in America. Theyare not an issue for our coastlines alone, but for every Americanin every state.

The 2005 hurricane season brought with it the most extensive andexpensive damages our nation has ever incurred. In fact, eight ofthe most costly catastrophes in U.S. history occurred in the pastfour years.

As the National Geographic noted at the outset of the 2005hurricane season, “The mighty Atlantic conveyor belt is in highgear, and sea-surface temperatures are up. That means we could bein for decades of coast-crushing hurricanes.”

With every possibility that America will be facing years ofrecord-shattering catastrophes, the commissioners are absolutelyright to call for a national financial backstop standing behind theprivate insurance market to help us repair, rebuild and recoverfrom catastrophe.

The creation of a national catastrophe fund would assure theviability of the private market and its ability to provide coverageto families, businesses and communities.

Such a catastrophe fund would function much in the same way aspersonal IRAs. Insurers would be required to deposit a portion ofhomeowners insurance premiums into the fund, where they would growfree of taxes, just like in an IRA. And, just like IRAs, thosefunds could only be tapped for very restrictive purposes. The fundwould only be used to help pay claims in the aftermath of a truecatastrophe.

Shortly after the national catastrophe summit, H.R. 4366–theHomeowners Insurance Protection Act of 2005–was introduced in theHouse of Representatives by two Florida Republican representatives,Ginny Brown-Waite and Clay Shaw. These members of Congressrecognize that America can do a better job preparing for andprotecting its citizens from natural catastrophes.

H.R. 4366 is a comprehensive approach that protects homes andproperty at a lower cost. It improves preparedness, strengthensfirst responders, mitigates the impact of a catastrophe on oureconomy, and reduces the financial burden on consumers andtaxpayers.

The bill would use private premium dollars to fund a backstop tothe private market and state catastrophe funds. This Consumer HELPFund will stand behind state catastrophe funds and pay claims whenthe state fund has exceeded its capacity.

Contributions to the fund would be based on actuarially soundand self-sufficient rates according to local exposures to ensurethere will be no subsidization of catastrophe-prone states by otherstates.

H.R. 4366 is a market-based approach to a true nationalchallenge that should be embraced by all members of the House ofRepresentative and the Senate before the next catastrophestrikes.