Cat Fight

I thought it was really a cynical ploy to gain votes in Florida for the Republicans to add a vague plank to their platform calling for a “natural disaster insurance policy,” with details to be determined, a week after the Democrats came out front and center for a federally-backed national catastrophe fund, and with their own presidential candidate vehemently against any direct involvement by Uncle Sam.

Americans hit by disaster must never again feel abandoned by their government, the Republican platform reads. The Katrina disaster taught a painful lesson: The federal government's system for responding to a natural calamity needs a radical overhaul.

The party added that we recognize the need for a natural disaster insurance policy.

Is it a coincidence that the party hastily tacked on their innocuous language right after Hurricane Gustav nearly hammered New Orleans again just three years after the devastation of Hurricane Katrina–with another hurricane, Hanna, and two additional windstorms on a collision course with the U.S. coast? I don't think so.

Fine. The more, the merrier! But it's not at all clear exactly what the Republican Party wants to do, especially with Sen. John McCain, its nominee, insisting he will not support any spreading of exposures outside of disaster-prone states–at least not with the federal government's backing.

Indeed, the flip use of the phrase “insurance policy” in its platform shows the Republicans did not put much thought into exactly what they were promising. As any underwriter, agent or, for that matter, consumer knows, a “policy” is something you buy to cover you against loss.

But in this case, I think the Republicans were talking about a broader policy, as in an approach of some sort–most likely without any direct government involvement–as opposed to an actual insurance contract.

The Democrats, on the other hand, were far more clear in their platform: We will develop a National Catastrophic Insurance Fund to offer an affordable insurance mechanism for high-risk catastrophes that no single private insurer can cover by itself for fear of bankruptcy. This will allow states and territories to deal comprehensively with the economic dislocation of natural disasters.

I'm not saying Washington can provide all the answers in assuring affordable property insurance coverage for states faced with the constant threat of hurricanes, earthquakes and other disasters. But it also appears that the private market alone cannot, or at least will not provide all the coverage that's required.

What do you folks think?