Representative Jared Moskowitz (D-FL) has reintroduced legislation to reduce homeowners' insurance premiums following natural disasters.
Specifically, the Natural Disaster Risk Reinsurance Act creates a catastrophic reinsurance backstop, meaning a cap on how much insurers pay in disaster claims, thereby reducing premiums and avoiding "risk of ruin," or the likelihood of losing all investment capital.
Additionally, the bill creates post-event bonds for losses exceeding a state's reinsurance cap, which states pay for over 10 years through a temporary surcharge that only activates after a catastrophic event.
Finally, states can choose to apply the backstop to specific natural disasters, such as floods, hurricanes, wildfires, and earthquakes.
As Rep. Moskowitz explained, Florida's high insurance premiums stem from insurers buying expensive reinsurance to avoid the risk of ruin after natural disasters, which in turn raises homeowners' premiums.
"Insurance costs are crushing Florida families, and they deserve real relief — not excuses," said Rep. Moskowitz in a press release. "This bill tackles the root of the problem by lowering reinsurance costs so insurers can lower premiums. It's long overdue relief for families just trying to stay in their homes."
In January, Moskowitz teamed up with Representative Laurel Lee (R-FL) to introduce the bipartisan Residential Emergency Asset Accumulation Deferred Taxation Yield (READY) Account Act, which would allow taxpayers to create a tax-free account similar to a Health Savings Account (HSA) to set aside funds for at least 12 different mitigation measures used by the Federal Emergency Management Agency (FEMA), such as reinforcing windows and doors, securing roofs, and raising a house or building floodwalls to prevent flooding.
"Disaster preparedness saves lives, and it can help reduce recovery costs when disasters hit the homes of hardworking Florida families," Moskowitz said. "For families in Florida and across the nation, this commonsense bill will lower sky-high insurance costs, help them stay ready, and keep their hard-earned money in their pockets."
