North Carolina Insurance Commissioner Wayne Goodwin praised that state’s General Assembly passage of a revised Beach Plan, which would limit insurance companies’ liability. North Carolina Gov. Bev Perdue (D-N.C.) has signed legislation. “I believe it defuses a ticking time bomb,” Goodwin said. “Had this bill not passed, we would have seen a greater exodus of insurance companies from this state.” Goodwin spoke to a crowd of about 75 insurance agents at a seminar held by the Professional Insurance Agents of North Carolina.

The original Beach Plan was adopted to promote economic development in eastern North Carolina and to ensure that coastal residents could get insurance for their homes. But since that plan was put into place, the program has not been adjusted to handle increasing property values at the coast, Goodwin explained. With no cap on their liability, some insurance companies decided coastal insurance wasn’t worth the risk, he said. Goodwin said that if less insurance companies provided services in the state, the availability of insurance would decrease, which in turn would increase the cost of insurance for consumers.

The new plan caps insurance companies’ liability at $1 billion. It would restrict property insurers from assessing policyholders after a catastrophe loss if that loss was under $1 billion.

NC Insurance Commissioner Speaks in Salisbury (Salisbury NC Post 8/27/09)

August 31, 2009