Posted On: January 30, 2006, 1:33 pm CST

Posted By: Chris

My opinion: This is the first round in phase two of the AG and Scruggs' public relations plan, with the "slow news day" help of the AP. They know that they won't win on the merits of the contract action. So here's the scenario.

Because the contract wording is approved by the DOI, the head of the DOI, the elected Insurance Commissioner, must be to blame. Look at who he gets his campaign contributions from, anyway. The IC has been in office so long that he has become a part of the problem. Let's vote him out and vote in someone who will make the insurance companies toe the line.

This is great rhetoric, except that the newly elected IC will still have to fight the same battles as the incumbent; making sure that the climate to sell policies is good enough to encourage carriers to stay.

There isn't an IC around who, before the last two hurricane seasons, would have ever convinced/coerced a homeowner's carrier to agree to cover storm surge. And, no matter what promises you hear, no future IC will ever get one to voluntarily insure it, either.

Forcing the coverage won't be a solution, either. Carriers will pull out of MS; or, unlike the NFIP, base the premium for this mandated coverage on an actuarial analysis of the risk, resulting in coverage that no one will be willing to pay, or able to afford, except Mr. Scruggs and his brother-in-law.

So, the IC is forced to make the coverage optional, but require informed rejection, a la UM/UIM. Then, the great uninsured masses of MS are right back where they were. Only this time, unless the agent screwed up, there is even more evidence that the policy won't cover the losses.

By that time, everyone will have forgotten who started this mess. Think hard, it starts with an "S"...