Democratic presidential candidate Barack Obama supports the proposed national catastrophe fund.

The legislation, the Homeowners Defense Act (HR 3355), is currently awaiting action by the Senate Banking Committee. The act states that the federal government would be responsible for packaging and issuing bonds to provide high-level insurance coverage to the state-sponsored insurance funds.

"I think that we need a national catastrophe fund," Senator Obama said in an interview with the Palm Beach Post. "The key is to make sure that it's run efficiently, that it's adequately funded, and that we build in smart incentives to assure that developers are mitigating risk when they're making decisions on where to locate homes or businesses."

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