Governor Barbour Signs "Wind Pool" Bill
From: Office of the Governor Filed
(Jackson, Mississippi) – Joined by lawmakers and other officials at the
Capitol, Governor Haley Barbour today signed a bill designed to help
promote the availability of insurance for Mississippi homeowners and
businesses, whose premiums skyrocketed after Hurricane Katrina.
“The wrath of Hurricane Katrina didn’t end when the wind and water
subsided in August 2005. As a state, we will be dealing with Katrina’s
aftermath for years to come, and the availability of insurance – not to
mention its affordability – is absolutely critical to helping homeowners
and businesses get back on their feet,” Governor Barbour said.
The bill deals with the “wind pool,” an insurer of last resort for homes
and businesses on the Coast that is funded through customer premiums and
assessments from every insurance company in Mississippi. Today there are
about 32,000 policies in the wind pool, up from 16,000 policies at the
time of Hurricane Katrina. One of the main purposes of the bill – known as
The Mississippi Growth and Redevelopment Act of 2007 –is to mitigate the
increase of insurance premium costs across the entire state.
The bill, unanimously approved by both houses of the Legislature, also
creates the Mississippi Windstorm Underwriting Association Reinsurance
Assistance Fund. Monies in the special fund may be used by the Department
of Insurance, with approval from the Legislature, to defray the cost for
reinsurance, lowering the risk for insurance companies writing policies in
This legislation provides $80 million over the next four years from the
insurance premium tax to buy reinsurance, which will result in lower
premiums for wind pool policy holders. The bill encourages companies to
write plans in the wind pool by providing an annual credit against state
insurance premium taxes for domestic and foreign insurance companies for
new wind and hail policies written in the coastal area of the state.
The total insured value of the wind pool is now $6 billion, and before
Hurricane Katrina it was $1.8 billion.
“This new infusion of money into the wind pool, coupled with the many
other steps that are being taken, offers renewed confidence that we will
rebuild bigger and better than ever,” Governor Barbour said. “As I sign
this measure into law as an immediate necessity, we must also remember
that the ultimate goal is to re-create the private insurance market so
that the wind pool isn’t even necessary. I see this as a step toward that
Mississippi Insurance Commissioner George Dale, who helped develop the
plan and attended the bill signing, said the new law will be a significant
“The Mississippi Legislature has passed what, aside from the Toyota plant
incentives, could be the most important economic development bill that
will be passed this session, House Bill 1500 or the Wind Pool bill,”
Commissioner Dale said. “This bill is not just about the Mississippi Gulf
Coast but will benefit everyone in Mississippi, homeowners and businesses
“This bill is an example of what we can do by working together. We want to
congratulate Senator Dean Kirby and Representative Mark Formby, their
respective Insurance Committees, Wind Pool representatives, and the Gulf
Coast Business Council, he said.
“The bill will go a long way in stabilizing the Mississippi insurance
market and demonstrates that Mississippi is serious about establishing and
maintaining a fair and stable market,” Commissioner Dale said.