Sanford has long sought coastal insurance fix

By Paul Steadman

Re"Insurance politicized," The Sun News editorial Sept. 8:

While the editorial did much to cut through rhetoric we've heard about our coastal property insurance problem, I take issue with the assertion that Gov. Mark Sanford "seems disinclined to engage" and has shown "diffidence" toward the issue. Sanford recognized the problem and went to work solving it long before it made headlines.

Upon taking office in 2003, Sanford reappointed Ernest Csiszar as director of the Department of Insurance.

While discussing the appointment with me and others, one of Sanford's priorities was the looming problem of availability and affordability of property insurance along our coast.

Csiszar responded to those concerns by convening the Coastal Property Task Force, including insurers, consumers and Realtors, whose mission was to monitor and discuss property insurance availability on the coast and possible solutions.

In 2004, Sanford supported and signed the Personal Lines Modernization Act passed by the General Assembly. The act was modeled after the successful reform in the automobile insurance market, which gave more options to automobile owners and led to a decrease in premiums as companies competed for business. This legislation was aimed at doing the same in the homeowners' market.

When Csiszar resigned and Sanford appointed Eleanor Kitzman, he made clear to her that coastal property insurance was a priority. In early 2005, Kitzman again convened the Coastal Property Task Force, issuing an open invitation to anyone concerned. The group discussed options to alleviate the problem of rising premiums and it was hoped that the legislation of 2004 would create positive results in the homeowners' market as reforms had in the automobile market. Through 2005 and 2006, the Department [of Insurance] continued its efforts, including hosting a Coastal Property Insurance Forum attended by Sanford.

While Sanford was working toward a solution, the nation was hit with the most catastrophic storms in history and predictions of more to come.

The impact has been widespread. According to the newspaper USA Today, Allstate announced in April that no new policies would be written in 14 Texas coastal counties. Allstate also stated that it won't write new policies in New York City, Long Island or Westchester County, where they haven't seen a hurricane in 70 years.

South Carolina has also avoided massive government bailouts. When faced with a $1.7 billion deficit in the state-backed insurer Citizens Property Insurance Corp., the Florida legislature had to contribute $715 million in taxpayer dollars, and Florida homeowners will be forced to pay the rest of the deficit through increased premiums. Florida is also confronting the failure of independent companies. The Poe Financial Group of Tampa was forced into receivership this summer. Condominium associations insured by Poe were forced to turn to the same Citizens Property Insurance Corp. and, according to the South Florida Sun-Sentinel, will face substantial premium increases.

Solving the coastal insurance problem isn't easy and will take cooperation from homeowners, insurance companies and every level of government. In testimony before Congress last week, Florida Insurance Commissioner Kevin McCarty lauded South Carolina's efforts toward solving the problem. The editorial of Sept. 8 is correct in that "the state can't force insurance companies to write low-premium policies here," and one cannot argue that homeowners' indignation is not justified over the human cost of increasing premiums.

But accusing Sanford of "diffidence" is flat wrong. His efforts demonstrate his concern and have contributed to steering us clear of the more severe effects of a crisis felt all along the East Coast.

The writer lives in Walterboro.