State insurance chief outlines payment plan
Scott Richardson, state insurance director and a former state senator from Hilton Head Island, was on the island this week for the Out of the Storm '08 insurance conference organized by the Competitive Enterprise Institute, a think tank that advocates
free-market economic policies.
At the conference, Richardson outlined a plan he's been working on for more than a year to help insurance companies better handle cases in which a home is destroyed during a storm.
After Hurricane Katrina, a small percentage of claims ended up in court over disputes about whether wind or flood waters
destroyed a house.
Richardson's plan would seek to have flood, wind and homeowner insurance writers agree on what percentage each would pay if a home is destroyed.
Percentages would depend on wind speed, storm surge and other factors.
Richardson told the conference attendees he is seeking to work with a disaster
modeling company to show a prototype
to insurers within the next 90 to 120 days.
The idea was warmly received.
"It's a practical solution to a complex problem," said Eric Nelson, an executive with Travelers Insurance, who served on a
discussion panel with Richardson.
Jim Faber
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