Tuesday, July 27, 2010


This is Lynn Jenkins, she does not represent us

Five years ago America's Gulf Coast faced Hurricane Katrina, one the five deadliest storms and the costliest natural disaster the nation has ever known. We all remember the immediate aftermath of that storm. The suffering in the streets of New Orleans and the chaos at the Superdome are permanently etched in our memories.

Hurricane Katrina

What we ignore and tend to forget is that thousands and thousands of homes were battered by hurricane force winds for hours before any storm surge finished them off. That means that thousands and thousands of homeowners and their families with adequate, or more than adequate, insurance expected their homeowner's insurance policies to make good on their losses.

Insurance Claims were Denied

Didn't happen. Katrina left us with a prime example of what I mean when I say that corporations don't have a butt to kick or a soul to save. The insurance adjusters claimed the loss came by water not from the wind. Why is that important? A water loss is a flood loss and the taxpayers pick up the tab. A wind loss is a covered hazard and the insurance company picks up the tab.

Representative Gene Taylor [D -Ms] at podium

Bottom line, the insurance industry refused to pay what they owed. Then, State by State, they pulled their business lines out of the Gulf Coast States. Here's an example provided by Mississippi's Democratic Representative from the floor of the House during consideration of H.R. 1264, the MULTIPLE PERIL INSURANCE ACT OF 2009:

Madam Speaker, if I was a shill for the insurance industry, and apparently we have our share on the floor today, I would do everything but talk about what the insurance industry did to south Mississippi after Hurricane Katrina. I would forget, if I was a member of the Rules Committee, the 12 years that they controlled the floor of the House of Representatives, the 12 years that they could have cut the Amtrak subsidy had they wanted to, but they didn't.

So let's get back to what we are going to talk about today. And, again, I thank the leadership for bringing this to the floor.

If you had visited south Mississippi in August of late 2005, gone to a little town called Bay St. Louis, you could have driven down the street and seen this house. It belonged to some folks named Corky and Molly Hadden. On August 29, 2005, Hurricane Katrina hit south Mississippi. So the Haddens left this because their Nation warned them that a bad storm was coming, and came home to this.

Corky is a financial manager; he is a smart guy. He had lot of insurance, he thought. As a matter of fact, Corky had $650,000 worth of insurance on that house. The problem was under the rules of the National Flood Insurance Program that Mr. Sessions agrees needs changing, and I am trying to change today, we paid the private sector, State Farm, All State, Nationwide, we pay them to sell the policy; they get a premium. We pay them to adjust the claim.

The problem is no one bothered to think that wait a minute, we are letting that claims adjuster decide he is playing God. He can say the wind did it, which means his company has to pay, State Farm, Nationwide or All State; or he can say the water did it, which means the taxpayers have to pay.

You are right, Mr. Sessions, we should not have paid that $18 billion. The reason we paid that $18 billion is a bad set of rules that allowed companies like State Farm, All State, Nationwide to stick the taxpayers with their bills. So 18 months after this event, Mr. Hadden, who had $650,000 worth of insurance on that nice house, was paid nothing by his insurer, State Farm Insurance Company.

Again, if you are a defender of the insurance industry, if they are helping you with your campaigns, you sure as heck don't want to talk about that, do you?

The next house, if you had gone a little bit further down the same street, you would have seen one of the oldest houses in Bay St. Louis, built around 1800. So from 1800 to 2005, no telling how many hurricanes it survived. It belonged to the Benvenutti family, a pretty old house.

This is what it looked like when they left because their Nation told them to get the heck out of there, there is a bad storm coming. Let's see what they came home to. This is what they came home to.

You know, for most people, including Mississippians, your house is your biggest investment. It is, to a large extent, an extension of yourself. So the Benvenuttis, realizing that that house meant a lot to them, had a lot of insurance, or so they thought, $586,000. When they filed their claim, for almost 24 months they were paid nothing on their wind insurance.

Now why is this significant? Well, NOAA, the Navy Oceanographic Lab and others went back and looked at the events that were called Hurricane Katrina, and NOAA tells us that for 4 hours before the storm surge arrived in south Mississippi, that house, the house before it, was subjected to hurricane-force winds for 4 hours before the water ever got there. Yet the insurance companies wanted to turn around and blame everything on the water. Why?

Because they could stick the taxpayers with the bill.

The next house is a more typical home, more modest home. This one is about a mile inland, about a mile inland, pretty good ways from the water. Beautiful home. This is what the folks who lived there, when they left, looked at last.

This is what they came home to.

It's not just three houses; it's not 30 houses. It was 30,000 houses that this happened to. So, again, these folks, knowing this was a big part of their lives, had $249,000 worth of insurance. Their insurance company was slightly more generous than the previous two times and offered them $10,000.

Now, Mr. Sessions points out that, incorrectly, that maybe government shouldn't be doing this. Well, maybe he doesn't talk to his folks in his State capital often enough because if he had he would know that his State is already doing this.

In the aftermath of Katrina, on a State-by-State basis, the insurance industry pulled out, left a vacuum. People had to have some form of wind insurance; and so on a State-by-State basis, the State picked up that obligation.

The Republican Minority is playing a shell game. They inherited a budget surplus from former Democratic President Bill Clinton. They and Republican President George Bush ran up record deficits, waged two wars off the books, gave the richest Americans huge tax breaks, and removed critical financial regulations leading to the worst economic meltdown since the Great Depression. Now these same wastrels who squandered the budget surplus have misspent these past two years obstructing the Economic Recovery and serving the interests of Wall Street, Big Banks, and the Insurance Lobby.

H.R. 1264, the MULTIPLE PERIL INSURANCE ACT OF 2009 passed the house on roll call 466, by a margin of 228 to 183. Lynn Jenkins, champion of Fat Cats, Big Banks, Insurance Companies & people so rich they have more dollars than sense again showed her true colors by voting against regular people.

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