The proposed National Association of Insurance Commissioners mega-catastrophe plan centering on an “all-perils” policy will “exacerbate the problems it seeks to correct,” according to a property-casualty trade group.
The National Association of Mutual Insurance Companies, based in Indianapolis, said in comments to the commissioners that if the price for this new policy is determined by government fiat, then “coverage for property owners in high-risk regions would likely be subsidized by property owners in low-risk regions.”
Robert Detlefsen, NAMIC public policy director, said that “unless all homeowners are required to purchase an identical all-perils policy, the plan will lead to adverse selection.”
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