Published: Sunday, December 19, 2010, 6:55 AM
ELBERTA, Alabama -- The response to the Deepwater Horizon oil spill has helped focus statewide attention on the insurance crisis affecting Mobile and Baldwin counties, former Alabama Insurance Commissioner Walter Bell said.
Bell said the "Roadmap to Resilience" report by the Coastal Recovery Coalition includes recommendations intended to improve insurance coverage and lower rates for residents.
"The BP oil spill was the catalyst to look at this whole thing again and say how can we protect ourselves living here in the Gulf Coast area, because, quite frankly, we’ve got substantial risks and those risks aren’t going to go away," Bell said. "We live with them every day, There’s nothing that’s going to be able to put up a barrier in the Gulf and stop hurricanes from coming onshore. Nothing. It’s been doing that for thousands of years and none of us are going to be able to stop it."
The report was presented to Gov. Bob Riley and Gov.-elect Robert Bentley on Wednesday, he told members of the South Baldwin Chamber of Commerce. Bell spoke at the chamber’s December Impact 2010 luncheon at the Elberta Civic Center.
Bell was Alabama insurance commissioner from 2003 to 2008. Since 2008, he has been the chairman of the Swiss Re America Holding Corp., a major re-insurance company in the area.
Coalition recommendations include improving buildings, increasing competition among insurance companies and making insurance coverage more understandable, he said.
"We’ve got to think about mitigating, adapting and finding competitive enough market forces that can hold the premiums down, finding enough discounts that we can give for the mitigation of property," he said.
Bell said Alabama officials should learn from the responses by Florida and Mississippi after hurricanes Ivan and Katrina and not try to subsidize insurance premiums or coverage. One lesson learned from hurricanes was that when the emergency funds were gone, so is the money to pay for insurance.
"After Hurricane Katrina, (Mississippi) Gov. Haley Barbour got some government money and he put $20 million a year toward some hurricane initiatives and tried to hold premiums down in the wind pool over there," Bell said. "You can’t continue to do that. He said last year ‘I think we can’t continue to do that any more,’ so now there’s going to be premium shock on the folks in Mississippi."
Instead, Alabama officials should use money to provide grants or low-interest loans to home and business owners who are willing to make their property more resistant to storms.
Work such as strengthening buildings will lower payments for insurance companies and premiums for property owners, he said.
Building codes have improved on the coast, but a statewide standard is needed for structures, he said. Inspections should also be improved.
"If the codes are there and people are not getting the roofs tied down or if they’re not putting enough nails in the shingles, they’re just going to blow off anyway," Bell said.
Bell said he met Bentley for the first time Wednesday and felt that the new governor understands the needs of the coastal area.
"He understands the driving force of Mobile and Baldwin County as being more than 20 percent of the tax revenues that go to the state, of being more than a third of the tourism dollars that are generated in the state," Bell said. "Not only that, I found out he’s got a home on Fort Morgan Road so he’s down here. He loves the area, too."
Bell said local support is also needed to put the plan into place.
"I don’t mean Montgomery, I mean the South Baldwin County Chamber, (local political action committee) GUMBO, Foley, Orange Beach, Mobile, Prichard, every other community in this two-county area, has to get behind this, build support for it, put work into it," he said. "This is the beginning. This is certainly not the end."
Bell told chamber members that he owns a condominium on Fort Morgan Road and understands the difficulties faced by property owners needing insurance.
"State Farm dropped me when I was the insurance commissioner for my condo down at the beach," he said. "They were not discriminating against anybody; certainly not me. I think they wanted to make an example of me and they did."
To see the complete 198-page "Roadmap to Resilience" report, go to http://media.al.com/live/other/CRC-Book-Download.pdf.
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