It seems the objective of reducing the Cat fund’s exposure is a legitimate. There are always possible ill effects (possible rate increases for the general public due to carriers having to purchase private reinsurance)but it is also a big problem if the fund can’t perform when needed.
However, my biggest questions for the author is:
“instead of reducing the fund’s capacity, lawmakers should increase it, reminding lawmakers that they also want to depopulate the state-backed property insurer Citizens Property Insurance Corp. and any increase in private reinsurance would stymie that objective.”
Please explain why…
Why would increasing the fund’s capacity help depopulate Citizens? This is reinsurance we are talking about.
It seems the objective of reducing the Cat fund’s exposure is a legitimate. There are always possible ill effects (possible rate increases for the general public due to carriers having to purchase private reinsurance)but it is also a big problem if the fund can’t perform when needed.
However, my biggest questions for the author is:
“instead of reducing the fund’s capacity, lawmakers should increase it, reminding lawmakers that they also want to depopulate the state-backed property insurer Citizens Property Insurance Corp. and any increase in private reinsurance would stymie that objective.”
Please explain why…
Why would increasing the fund’s capacity help depopulate Citizens? This is reinsurance we are talking about.