Mississippi lawmakers have agreed upon a plan to use $20 million in premium taxes on policies statewide to help lower premiums for property owners in high-risk areas who are insured by the wind pool.
The plan hashed out between the House and Senate would begin this year and run until 2010, totaling $80 million.
Legislative researchers estimate the relief plan could lower annual premiums by as much as $500 a year. Since Hurricane Katrina struck Aug. 29, 2005, the wind pool’s rates have jumped 268 percent for businesses and 90 percent for homeowners.
Mississippi House Bill 1500 creates a special fund that the wind pool would be able to access to cover costs as necessary. The fund would be allowed to accumulate reserves up to $50 million; any amount over that would be sent to the general treasury.
The bill also authorizes the wind pool to levy assessments against insurers if a storm produces losses in excess of funds immediately available. However the plan also includes a provision to reimburse insurers if they are assessed for excess storm losses.
The bill grants insurers a tax credit up to $100,000 per calendar year against premium taxes for writing new wind and hail policies in coastal communities.
Topics Mississippi
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