Stephanie – Email me at davcrump@yahoo.com – I just received an updated Probable Maximum Loss model result from TWIA that I welcome sharing.
Overview:
Galveston 75th percentile model loss = $7 billion
Corpus Christi = $5.7 billion
Brownsville = $900 million
My calculation of claims funding for the 2013 hurricane season:
1. Cash on hand = 0 – this is confirmed form TWIA on the Public Information Response received yesterday.
2. Funds in CRTF = $180 million per TWIA on the Public Information Response received yesterday.
3. Class 1 Bonds – you have got to be kidding! – officially not marketable = 0
4. Class 2 Bonds – without the Class 1 bonds, these drop down and TWIA has to repay half with future revenues. My call is that these are also not marketable because TWIA has no future revenues to repay any of its share. Most recent financials were a large loss. My call = 0
5. Class 3 Bonds – Will be marketable because they are repaid by insurance company assessments = $500 million
6. Reinsurance – you have got to be kidding! – no money to buy any because they are losing money. = 0
Total available for claims in the 2013 hurricane season for TWIA = $680 million. There are no hurricanes strikes of any magnitude that could be funded. This puts TWIA in solvency risk from a large thunderstorm in an urban area.
Some wind damage to a roof is one thing,but a total loss due to wind is another.In my mind there is no justification in continually replacing homes in those areas. If people insist on living in those areas they should do it at their own risk. This has been an ongoing problem for years on the Gulf and Atlantic coasts. Also in major flood zone areas.
Ultimately if these risks can’t be insured in some way, then it will force people to move away from coastal, wind prone areas.
Remember though that this is coming from a pro industry official. Its most likely a lot better than what might happen if an activist, anti industry foe is able to push something through that we REALLY don’t like or they do something really horrible like the mess in Florida-eeeek!
Stephanie – Email me at davcrump@yahoo.com – I just received an updated Probable Maximum Loss model result from TWIA that I welcome sharing.
Overview:
Galveston 75th percentile model loss = $7 billion
Corpus Christi = $5.7 billion
Brownsville = $900 million
My calculation of claims funding for the 2013 hurricane season:
1. Cash on hand = 0 – this is confirmed form TWIA on the Public Information Response received yesterday.
2. Funds in CRTF = $180 million per TWIA on the Public Information Response received yesterday.
3. Class 1 Bonds – you have got to be kidding! – officially not marketable = 0
4. Class 2 Bonds – without the Class 1 bonds, these drop down and TWIA has to repay half with future revenues. My call is that these are also not marketable because TWIA has no future revenues to repay any of its share. Most recent financials were a large loss. My call = 0
5. Class 3 Bonds – Will be marketable because they are repaid by insurance company assessments = $500 million
6. Reinsurance – you have got to be kidding! – no money to buy any because they are losing money. = 0
Total available for claims in the 2013 hurricane season for TWIA = $680 million. There are no hurricanes strikes of any magnitude that could be funded. This puts TWIA in solvency risk from a large thunderstorm in an urban area.
Some wind damage to a roof is one thing,but a total loss due to wind is another.In my mind there is no justification in continually replacing homes in those areas. If people insist on living in those areas they should do it at their own risk. This has been an ongoing problem for years on the Gulf and Atlantic coasts. Also in major flood zone areas.
The Senator must have coastal property
Ultimately if these risks can’t be insured in some way, then it will force people to move away from coastal, wind prone areas.
Remember though that this is coming from a pro industry official. Its most likely a lot better than what might happen if an activist, anti industry foe is able to push something through that we REALLY don’t like or they do something really horrible like the mess in Florida-eeeek!