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State Farm will increase insurance rates 10 to 12 percent in coastal counties
Published: Friday, October 01, 2010, 8:00 AM Updated: Friday, October 01, 2010, 10:22 AM
Jeff Amy, Press-Register Jeff Amy, Press-Register
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State Farm Fire and Casualty Co. said Thursday that it would increase rates by an average of 10 percent to 12 percent for most Mobile and Baldwin policyholders.
Statewide, including the two coastal counties, customers will pay an average of 8.4 percent more.
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The Alfa Mutual Insurance group, the state’s second-largest property insurer, raised rates statewide by an average of 18 percent on Sept. 1. Allstate Indemnity Co., the largest branch of the state’s No. 3 homeowners insurer, raised rates by a statewide average of 9.9 percent on Sept. 13.
The rate changes continue a trend that has seen prices for most Alabama homeowners insurance far outpacing the rate of inflation.
The increases were reviewed by both in-house and contract actuaries and “found to be necessary,” said Ragan Ingram, chief of staff for Alabama Insurance Commissioner Jim Ridling. The Insurance Department must approve such changes in advance.
Effective Nov. 1, State Farm will impose an average increase of 9.9 percent in areas south of Interstate 10 in Mobile County and in areas generally west and south of U.S. 98 in Baldwin County, the company said. For most of the rest of the two counties, the increase will be 11.9 percent.
State Farm has more than 40,000 property policies in the coastal counties, although that includes renters, condominium and other types of policies.
Spokesman David Majors said the rate increases cover projected costs, based on past trends.
“Our overall claims in Alabama have increased,” he said, both in number and in average cost.
Coastal insurance rate increases
State Farm rate history:
* 2008: 12 percent to 18 percent increase in Mobile and Baldwin counties; 0.9 percent decrease statewide.
* 2009: No change in Mobile and Baldwin, 19.1 percent increase statewide.
* 2010: 10 to 12 percent increase in Mobile and Baldwin, 8.4 percent increase statewide.
Alfa rate history:
* 2008: No change.
* 2009: 6.5 percent to 16.6 percent in Mobile and Baldwin, 5.8 percent to 6.5 percent statewide.
* 2010: 18 percent statewide.
Allstate Indemnity rate history:
* 2008: 9.9 percent statewide.
* 2009: No change.
* 2010: 9.9 percent statewide.
Sources: Press-Register files, Alabama Department of Insurance
Spokesman Jeff Helms said Montgomery-based Alfa has suffered more losses from inland tornadoes and windstorms, prompting its rate change.
“We have seen an increased pattern of very severe spring storms,” Helms said.
Statewide, homeowners insurance has been expensive, compared to national averages. The typical Alabama policyholder paid $904 for one year’s coverage in 2007, the most recent data available. That was 12th highest among states. Nationwide, the average house cost $822 to insure.
There’s no data available for how much insurance costs along the Alabama coast, but premiums are known to be higher.
Rate increases had paused in 2007 after steep increases following Hurricane Ivan in 2004 and Katrina in 2005.
A few State Farm policyholders may get breaks. The company said that it would increase its discount for combining auto and homeowners policies from 20 percent to 25 percent.
Policyholders who can’t or don’t buy wind and hail coverage from State Farm will also get breaks. Non-wind homeowners policyholders north of Interstate 10 in Mobile County or generally north and east of U.S. 98 in Baldwin County would only pay 31 percent of the face value of a homeowners policy, down from 40 percent. Renters and condo unit owners also would get bigger breaks.
“I don’t know why State Farm is doing this,” said Earl Janssen of Foley. Janssen, a State Farm policyholder, is a member of the Homeowners’ Hurricane Insurance Initiative, a group that lobbies for lower insurance rates.
Janssen said that he pays $3,300 a year right now to cover his 2,000-square-foot house. Janssen carries a $5,000 deductible for all other risks than wind, meaning he would recover nothing from a small theft loss, for example. On the hurricane part of the policy, he has a 2 percent deductible.
“We’ve had no damage or hurricanes in the last few years here,” Janssen said. “Their profits have gone up.”
State Farm, based in Bloomington, Ill., posted a $777 million profit in 2009, compared to a $542 million loss in 2008.
Majors said that State Farm has found that the number of claims and the cost of settling each claim both go up during recessions, saying that’s one factor that may have contributed to the increase.
“The homeowners line of business has been a challenging line of business for the insurance industry as a whole in terms of profitability,” said Alfa’s Helms.
Friday, October 8, 2010
Friday, July 2, 2010
Premiums for new High Risk Health Pool...
Here.
President Barack Obama's new health coverage for uninsured people with health problems won't be cheap -- monthly premiums as high as $900, administration officials said.
Prices will vary by state and type of coverage from a low of $140 a month to as much as $900, said Richard Popper, deputy director of a new insurance office at the federal Health and Human Services department. Officials provided details of the plan, which starts enrolling people Thursday.
The price range is so wide because premiums will be keyed to standard individual health insurance rates in each state, which can differ dramatically because of medical costs and the scope of coverage. Independent experts estimate premiums will average around $400 to $600 a month. Younger people will pay less.
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"There are going to be meaningful premiums that are going to be required to stay in this plan ... in the hundreds of dollars,'' said Popper, with the Office of Consumer Information and Insurance Oversight.
Despite the cost, consumer advocates are urging uninsured people with health problems to sign up soon, because they cannot be turned away for medical reasons. Family members may be able to help with premiums.
The Pre-Existing Condition Insurance Plan will start taking applications Thursday in many states, the rest by the end of the month. Coverage will be available as early as August 1.
Consumers can go to a new government website, HealthCare.gov, to find out about the program and other coverage options in their state. Twenty-nine states and Washington, D.C., will administer their own plans. The federal government will run the program in the remaining 21 states.
The new plan is a stopgap for vulnerable people locked out of the private insurance market because of medical problems. It's intended to remain available until 2014, when core health care overhaul provisions take effect. At that time, insurers will be barred from turning away people in poor health, low- and middle-income households will get subsidized coverage, and most Americans will for the first time be required to carry health insurance.
To qualify for the pre-existing condition plan, people must be uninsured for at least six months and have been turned down for coverage by a private insurer because of a medical problem. U.S. citizens and legal residents are eligible.
The biggest question hanging over the program is whether the $5 billion allocated will be enough.
Millions of people meet the basic qualifications for coverage, and technical experts who advise Congress and the administration have warned the funds could be exhausted as early as the end of 2011.
HHS officials sidestepped questions about what would happen if the money runs out. One option is for the government to limit enrollment.
Popper estimated about 200,000 people would be enrolled in the program at any one time, but other HHS experts estimated that 375,000 would sign up this year, and the Congressional Budget Office says the total could reach 700,000 in 2013.
President Barack Obama's new health coverage for uninsured people with health problems won't be cheap -- monthly premiums as high as $900, administration officials said.
Prices will vary by state and type of coverage from a low of $140 a month to as much as $900, said Richard Popper, deputy director of a new insurance office at the federal Health and Human Services department. Officials provided details of the plan, which starts enrolling people Thursday.
The price range is so wide because premiums will be keyed to standard individual health insurance rates in each state, which can differ dramatically because of medical costs and the scope of coverage. Independent experts estimate premiums will average around $400 to $600 a month. Younger people will pay less.
Advertisement
The Ultimate How to Insurance Guide for Agents, Brokers, Underwriters and Adjusters
"There are going to be meaningful premiums that are going to be required to stay in this plan ... in the hundreds of dollars,'' said Popper, with the Office of Consumer Information and Insurance Oversight.
Despite the cost, consumer advocates are urging uninsured people with health problems to sign up soon, because they cannot be turned away for medical reasons. Family members may be able to help with premiums.
The Pre-Existing Condition Insurance Plan will start taking applications Thursday in many states, the rest by the end of the month. Coverage will be available as early as August 1.
Consumers can go to a new government website, HealthCare.gov, to find out about the program and other coverage options in their state. Twenty-nine states and Washington, D.C., will administer their own plans. The federal government will run the program in the remaining 21 states.
The new plan is a stopgap for vulnerable people locked out of the private insurance market because of medical problems. It's intended to remain available until 2014, when core health care overhaul provisions take effect. At that time, insurers will be barred from turning away people in poor health, low- and middle-income households will get subsidized coverage, and most Americans will for the first time be required to carry health insurance.
To qualify for the pre-existing condition plan, people must be uninsured for at least six months and have been turned down for coverage by a private insurer because of a medical problem. U.S. citizens and legal residents are eligible.
The biggest question hanging over the program is whether the $5 billion allocated will be enough.
Millions of people meet the basic qualifications for coverage, and technical experts who advise Congress and the administration have warned the funds could be exhausted as early as the end of 2011.
HHS officials sidestepped questions about what would happen if the money runs out. One option is for the government to limit enrollment.
Popper estimated about 200,000 people would be enrolled in the program at any one time, but other HHS experts estimated that 375,000 would sign up this year, and the Congressional Budget Office says the total could reach 700,000 in 2013.
Monday, May 24, 2010
Small businesses to lose Zurich insurance policies as part of Farmers cutback
Small businesses to lose Zurich insurance policies as part of Farmers cutback
By Jeff Amy
May 19, 2010, 7:01AM
BUSINESS icon
MOBILE, Ala. -- Zurich Financial Services will drop 554 small business property policies in Mobile and Baldwin counties beginning Oct. 1, citing risks from hurricane exposure. The move comes after Farmers Insurance Group, a Zurich unit that mainly covers homeowners, announced a larger cutback in February.
"This is an effort to manage our overall business volume and our coastal catastrophe exposure," said spokesman Mark Toohey.
He said the 554 policies represent a little more than half of the number of Zurich small business policies in Mobile and Baldwin counties, and about 10 percent of such policies statewide.
Company officials said they were not dropping all commercial wind coverage in Mobile and Baldwin counties. Independent agents who sell the policies, though, said they believe the insurer is exiting the market entirely.
"Zurich is pulling out," said Jay Ison, a partner in the Thames Batré Mattei Beville & Ison agency in Mobile.
The Swiss insurance titan took control of Farmers in 1998. In 2008, it combined its pre-existing small business line with Farmers, creating one of the five largest insurers for small business, with $2.3 billion in nationwide revenue.
Farmers said in February that it was dropping wind coverage on 10,000 residential policies in Mobile and Baldwin counties. It also dropped 400 small business policies sold by Farmers-brand agents. Toohey said those 400 policies represent just more than 30 percent of Farmers-brand small business policies in Mobile and Baldwin counties. Farmers agents can continue selling business coverage that excludes wind.
Zurich had largely stopped writing new business along the Alabama coast after 2004's Hurricane Ivan and 2005's Hurricane Katrina, agents said.
Gaylord Lyon, president of Mobile's Lyon Fry Cadden Insurance Agency, said about 40 of his customers have policies with Zurich right now. He said it would be hard to find equal coverage at the same price.
In the overall market, prices and availability are not as good as they were before Ivan. But things have improved, said Andrew Davis, a vice president with International Assurance Inc., a Mobile agency.
"Right after Ivan, if property was involved, your were going to pay through the nose," he said.
Ragan Ingram, chief of staff for Insurance Commissioner Jim Ridling, noted the decline in policies carried by the Alabama Insurance Underwriting Association, an insurer of last resort. "The department believes that commercial insurance is readily available in the Mobile and Baldwin marketplace," Ingram wrote in an e-mail.
He wrote that regulators know of no other carriers that are leaving.
By contrast, the states four largest homeowners carriers have announced that they are dropping wind coverage or all coverage on more than 50,000 homeowners policies since Ivan.
By Jeff Amy
May 19, 2010, 7:01AM
BUSINESS icon
MOBILE, Ala. -- Zurich Financial Services will drop 554 small business property policies in Mobile and Baldwin counties beginning Oct. 1, citing risks from hurricane exposure. The move comes after Farmers Insurance Group, a Zurich unit that mainly covers homeowners, announced a larger cutback in February.
"This is an effort to manage our overall business volume and our coastal catastrophe exposure," said spokesman Mark Toohey.
He said the 554 policies represent a little more than half of the number of Zurich small business policies in Mobile and Baldwin counties, and about 10 percent of such policies statewide.
Company officials said they were not dropping all commercial wind coverage in Mobile and Baldwin counties. Independent agents who sell the policies, though, said they believe the insurer is exiting the market entirely.
"Zurich is pulling out," said Jay Ison, a partner in the Thames Batré Mattei Beville & Ison agency in Mobile.
The Swiss insurance titan took control of Farmers in 1998. In 2008, it combined its pre-existing small business line with Farmers, creating one of the five largest insurers for small business, with $2.3 billion in nationwide revenue.
Farmers said in February that it was dropping wind coverage on 10,000 residential policies in Mobile and Baldwin counties. It also dropped 400 small business policies sold by Farmers-brand agents. Toohey said those 400 policies represent just more than 30 percent of Farmers-brand small business policies in Mobile and Baldwin counties. Farmers agents can continue selling business coverage that excludes wind.
Zurich had largely stopped writing new business along the Alabama coast after 2004's Hurricane Ivan and 2005's Hurricane Katrina, agents said.
Gaylord Lyon, president of Mobile's Lyon Fry Cadden Insurance Agency, said about 40 of his customers have policies with Zurich right now. He said it would be hard to find equal coverage at the same price.
In the overall market, prices and availability are not as good as they were before Ivan. But things have improved, said Andrew Davis, a vice president with International Assurance Inc., a Mobile agency.
"Right after Ivan, if property was involved, your were going to pay through the nose," he said.
Ragan Ingram, chief of staff for Insurance Commissioner Jim Ridling, noted the decline in policies carried by the Alabama Insurance Underwriting Association, an insurer of last resort. "The department believes that commercial insurance is readily available in the Mobile and Baldwin marketplace," Ingram wrote in an e-mail.
He wrote that regulators know of no other carriers that are leaving.
By contrast, the states four largest homeowners carriers have announced that they are dropping wind coverage or all coverage on more than 50,000 homeowners policies since Ivan.
Monday, May 10, 2010
Editorial: Legislators need educating on coastal insurance
insurance
By Press-Register Editorial Board
May 10, 2010, 5:11AM
THIS YEAR’S session of the Legislature confirmed what property owners in southwest Alabama already knew: Key legislators have little or no understanding of what the crisis in the region’s homeowners’ insurance market means for the state as a whole.
While major insurers continued their retreat from the coast, dropping thousands of wind policies in Mobile and Baldwin counties, the Legislature failed to act on more than a half-dozen solid proposals for stabilizing the coastal insurance market.
Six insurance bills, including a seemingly noncontroversial requirement for the state’s insurer of last resort to refer to itself as the "wind pool" instead of using the misleading moniker "beach pool," went down in one Senate committee meeting. Sen. Lowell Barron, D-Fyffe, who once based his opposition to insurance reform on the distance from Fyffe to the Alabama coast, couldn’t get past a personality conflict with Sen. Ben Brooks, the Mobile Republican who sponsored several insurance bills. Sen. Barron said his colleague was "abrasive" and wanted others to "help him solve his problems."
Apparently Sen. Barron missed the point that the insurance bills were intended to help solve problems affecting thousands of property owners, the state’s revenue system and a huge chunk of Alabama’s $9 billion tourism industry.
Mobile and Baldwin counties generate $1.8 billion in state revenue. Another bad hurricane season — with the accompanying hit on coastal insurance — would wipe out tens of millions in tax revenue that Sen. Barron and his colleagues in north Alabama need to provide services for their own constitutuents.
The Legislature did approve one insurance bill this year: Sen. Trip Pittman’s measure to make it easier for "surplus lines carriers" — insurers whose rates aren’t regulated by the state — to enter the coastal market.
Any insurance legislation that promotes competition in the coastal counties helps, but most surplus lines companies have relatively high rates, and their policyholders are vulnerable if the companies go bankrupt.
In 2009, the Legislature passed a bill sponsored by Sen. Brooks that allows homeowners to reduce their premiums if they make their houses more hurricane-resistant. This measure, and Sen. Pittman’s surplus lines bill, do represent progress on the coastal insurance front, but the Legislature must do more than inch forward on an issue of major significance for the state’s economy.
Before the Legislature convenes next year, advocates of insurance reform need to launch an all-out campaign to educate senators and House members from north Alabama on the crisis in the coastal insurance market and its ramifications for their constituents. The Press-Register editorial board believes that if Sen. Barron and his allies truly realized what’s at stake in the debate, they would put aside regional and personal differences and get behind a plan to protect the economy of southwest Alabama.
By Press-Register Editorial Board
May 10, 2010, 5:11AM
THIS YEAR’S session of the Legislature confirmed what property owners in southwest Alabama already knew: Key legislators have little or no understanding of what the crisis in the region’s homeowners’ insurance market means for the state as a whole.
While major insurers continued their retreat from the coast, dropping thousands of wind policies in Mobile and Baldwin counties, the Legislature failed to act on more than a half-dozen solid proposals for stabilizing the coastal insurance market.
Six insurance bills, including a seemingly noncontroversial requirement for the state’s insurer of last resort to refer to itself as the "wind pool" instead of using the misleading moniker "beach pool," went down in one Senate committee meeting. Sen. Lowell Barron, D-Fyffe, who once based his opposition to insurance reform on the distance from Fyffe to the Alabama coast, couldn’t get past a personality conflict with Sen. Ben Brooks, the Mobile Republican who sponsored several insurance bills. Sen. Barron said his colleague was "abrasive" and wanted others to "help him solve his problems."
Apparently Sen. Barron missed the point that the insurance bills were intended to help solve problems affecting thousands of property owners, the state’s revenue system and a huge chunk of Alabama’s $9 billion tourism industry.
Mobile and Baldwin counties generate $1.8 billion in state revenue. Another bad hurricane season — with the accompanying hit on coastal insurance — would wipe out tens of millions in tax revenue that Sen. Barron and his colleagues in north Alabama need to provide services for their own constitutuents.
The Legislature did approve one insurance bill this year: Sen. Trip Pittman’s measure to make it easier for "surplus lines carriers" — insurers whose rates aren’t regulated by the state — to enter the coastal market.
Any insurance legislation that promotes competition in the coastal counties helps, but most surplus lines companies have relatively high rates, and their policyholders are vulnerable if the companies go bankrupt.
In 2009, the Legislature passed a bill sponsored by Sen. Brooks that allows homeowners to reduce their premiums if they make their houses more hurricane-resistant. This measure, and Sen. Pittman’s surplus lines bill, do represent progress on the coastal insurance front, but the Legislature must do more than inch forward on an issue of major significance for the state’s economy.
Before the Legislature convenes next year, advocates of insurance reform need to launch an all-out campaign to educate senators and House members from north Alabama on the crisis in the coastal insurance market and its ramifications for their constituents. The Press-Register editorial board believes that if Sen. Barron and his allies truly realized what’s at stake in the debate, they would put aside regional and personal differences and get behind a plan to protect the economy of southwest Alabama.
Sunday, May 9, 2010
Saturday, May 8, 2010
As Tennessee Copes With Flooding Disaster, FEMA Faces Own Financial Crisis
With a flooded Tennessee becoming the latest disaster to strike the United States, the Federal Emergency Management Agency is confronting its own emergency as its relief funds run perilously low.
Last month, FEMA Director W. Craig Fugate wrote a letter to Congress warning that its relief fund had fallen to $693 million as of April 7 but the agency owed $645 million to 47 states for past disasters. That doesn't include the $1.7 billion settlement the agency owes to the Gulf Coast state and city governments for Hurricane Katrina.
Now FEMA is handing out money to the residents of Tennessee after deadly floods ravaged the region last weekend.
FEMA has already approved $4.1 million in individual assistance and more than 16,200 Tennesseans had registered with FEMA for disaster assistance by Saturday morning with 650 inspections complete.
White House spokesman Robert Gibbs said Friday that FEMA will probably need a shot of supplemental funding. The administration is seeking $5.1 billion in emergency funding from Congress.
Homeland Security Secretary Janet Napolitano toured the area Saturday and found residents already repairing their homes and business owners pushing to re-open.
"DHS and the entire federal government will do everything possible to support the people of Tennessee and across the Southeast in getting back on their feet quickly -- coordinated every step of the way with our state and local partners," Napolitano said.
The outlook for the devastated areas of Tennessee, Mississippi and Kentucky remained grim Saturday as the death toll climbed to 31 with the discovery of a missing kayaker's body in Kentucky. Twenty died in Tennessee alone.
Nashville Mayor Karl Dean raised the damage estimate for his city to $1.5 billion Friday, with 17 percent of Davidson County still to be checked. Already officials know 9,300 properties have been damaged and almost 2,000 of those are residences. Dean said the damage total will go up because it doesn't include damage to roads, bridges or the contents of the buildings.
"While the numbers seem daunting, and they truly are large, Nashville is in the process of recovering," Dean said.
But some analysts believe FEMA was never meant to be -- and shouldn't be -- the disaster response agency for the nation.
"From an operational standpoint, disaster response should be driven by state and local governments, as they are the owners of most of the response resources and they are the first on the scene when disaster strikes," Jena Baker McNeill and Matt Mayer of the Heritage Foundation said in a report published last month. "Supplanting this funding encourages state and local governments to not be prepared, knowing that the federal government will bail them out."
The report found that the yearly average of FEMA declarations has tripled from 43 under the first President Bush to 89 under President Clinton to 130 under the second President Bush.
President Obama issued 108 declarations in his first year in office – the 12th highest in FEMA history – without the occurrence of one hurricane or other major disaster, the report said. In the first three months of 2010, Obama has issued 32 declarations, putting him on pace for 128 declarations for the year – the sixth most in FEMA history, according to the report.
The report says the reason behind the increase is governors, as their state budgets decline, are more likely to seek emergency declarations from FEMA that requires the federal government pay up to 100 percent of the disaster response bill.
"Truly catastrophic disasters that overwhelm state and local governments are a welcome forum for FEMA intervention; that is, after all, the very purpose of FEMA declarations," the report reads. "However, all too often disaster politics, rather than effective policy, drive decisions on disaster response. Washington policymakers simply do not know how to say 'no' to spending more on disasters. Consequently, FEMA can no longer meet its financial commitments."
The Associated Press contributed to this report.
Last month, FEMA Director W. Craig Fugate wrote a letter to Congress warning that its relief fund had fallen to $693 million as of April 7 but the agency owed $645 million to 47 states for past disasters. That doesn't include the $1.7 billion settlement the agency owes to the Gulf Coast state and city governments for Hurricane Katrina.
Now FEMA is handing out money to the residents of Tennessee after deadly floods ravaged the region last weekend.
FEMA has already approved $4.1 million in individual assistance and more than 16,200 Tennesseans had registered with FEMA for disaster assistance by Saturday morning with 650 inspections complete.
White House spokesman Robert Gibbs said Friday that FEMA will probably need a shot of supplemental funding. The administration is seeking $5.1 billion in emergency funding from Congress.
Homeland Security Secretary Janet Napolitano toured the area Saturday and found residents already repairing their homes and business owners pushing to re-open.
"DHS and the entire federal government will do everything possible to support the people of Tennessee and across the Southeast in getting back on their feet quickly -- coordinated every step of the way with our state and local partners," Napolitano said.
The outlook for the devastated areas of Tennessee, Mississippi and Kentucky remained grim Saturday as the death toll climbed to 31 with the discovery of a missing kayaker's body in Kentucky. Twenty died in Tennessee alone.
Nashville Mayor Karl Dean raised the damage estimate for his city to $1.5 billion Friday, with 17 percent of Davidson County still to be checked. Already officials know 9,300 properties have been damaged and almost 2,000 of those are residences. Dean said the damage total will go up because it doesn't include damage to roads, bridges or the contents of the buildings.
"While the numbers seem daunting, and they truly are large, Nashville is in the process of recovering," Dean said.
But some analysts believe FEMA was never meant to be -- and shouldn't be -- the disaster response agency for the nation.
"From an operational standpoint, disaster response should be driven by state and local governments, as they are the owners of most of the response resources and they are the first on the scene when disaster strikes," Jena Baker McNeill and Matt Mayer of the Heritage Foundation said in a report published last month. "Supplanting this funding encourages state and local governments to not be prepared, knowing that the federal government will bail them out."
The report found that the yearly average of FEMA declarations has tripled from 43 under the first President Bush to 89 under President Clinton to 130 under the second President Bush.
President Obama issued 108 declarations in his first year in office – the 12th highest in FEMA history – without the occurrence of one hurricane or other major disaster, the report said. In the first three months of 2010, Obama has issued 32 declarations, putting him on pace for 128 declarations for the year – the sixth most in FEMA history, according to the report.
The report says the reason behind the increase is governors, as their state budgets decline, are more likely to seek emergency declarations from FEMA that requires the federal government pay up to 100 percent of the disaster response bill.
"Truly catastrophic disasters that overwhelm state and local governments are a welcome forum for FEMA intervention; that is, after all, the very purpose of FEMA declarations," the report reads. "However, all too often disaster politics, rather than effective policy, drive decisions on disaster response. Washington policymakers simply do not know how to say 'no' to spending more on disasters. Consequently, FEMA can no longer meet its financial commitments."
The Associated Press contributed to this report.
Wednesday, May 5, 2010
Update from Congressman Gene Taylor
Dear Friends,
The oil spill out in the Gulf is a big deal to all of us. It's deadly serious. Like you, I very much want to see the oil leak capped as quickly as possible. In fact, I wrote Secretary of Defense Robert Gates on Friday urging him to make available all of the resources of the U.S. military to help in the effort to stop the spill and mitigate its effects, and I spoke personally with Admiral Gary Roughead, Chief of Naval Operations for the Navy, who assured me that every resource of the United States Navy has been made available.
The good news is that because the oil rig was so far out to sea, the Mississippi coast is a long way from the source. As of today, there is no oil in the Mississippi Sound. That works in our favor.
On Saturday, I saw firsthand that the oil was further away from the Mississippi Sound and the Louisiana Marshes than the media had reported and predicted. Several days of heavy seas helped to break down some of the oil into a thin sheen. According to experts such as Dr. Bill Walker, Director of the Mississippi Department of Marine Resources, most of that oil sheen will evaporate in direct sunlight.
The thicker portions of the oil spill were still further offshore, closer to the source of the spill, so we still have time to prevent the worst-case scenario from happening. I have conferred with Admiral Thad Allen, the Commandant of the U.S. Coast Guard, and Captain Ed Stanton, the Federal On-Scene Coordinator for the Coast Guard, and I am confident that they are doing everything possible to minimize and mitigate the impact of the oil spill.
The people working to contain the spill have been encouraged that the dispersants sprayed on the oil at the surface and released near the oil leaks 5,000 feet below the surface are achieving the desired result of breaking-up the oil into smaller droplets and oil sheen—which, again, can more easily evaporate or naturally degrade. This is good news.
Thankfully, it appears that we are going to have a few days of good weather and calm seas that will allow the Coast Guard and other responders to contain and collect more of the oil-water mix and skim it into barges and tankers, or burn it in a controlled manner. Calmer winds also allow them to resume spraying dispersants from the air to continue to break up the thick portions of the spill.
Congress passed the Oil Pollution act of 1990 after the Exxon Valdez spill. Almost every response happening now is a result of that legislation that I voted for back then. The legislation calls on the oil companies to have virtually unlimited liability for the damages and the cleanup. BP is going to pay the bill, and the federal government will make sure that they do so.
I also want to make it clear that what is happening out in the Gulf is not the same as Hurricane Katrina, which was the most destructive natural disaster in our nation’s history. With Katrina, an estimated 70,000 Mississippi families were displaced from their homes, and 235 people died in our state alone.
Hurricane Katrina caused billions of dollars of property damage, of course, but it also caused substantial environmental damage. The storm surge pushed toxic chemicals, dead animal carcasses, raw sewage, and other hazardous debris all around the coastline and into coastal waters. So far, this oil spill has not caused nearly as much environmental damage as Katrina, and we all are working to keep it that way.
I continue to closely monitor the sub-surface efforts to stem the leak. I continue to work with the Coast Guard and other local, state, and federal agencies to ensure that individuals or companies that are interested in assisting with the response efforts are put in touch with the appropriate officials.
I assure you that this oil spill is being taken very seriously. But I also want to calm some of the hysteria that has resulted from those who have aired or published stories with doomsday headlines. Rather than adding to the panic, I am trying to accurately describe the current situation.
We are preparing for the worst and hoping for the best. That is how most of us live our lives. The Mississippi Department of Marine Resources is already training people to respond should help be necessary.
As a South Mississippian, I am very proud of the thousands of South Mississippians who have volunteered to help. Thank you.
Sincerely,
Rep. Gene Taylor's signature
GENE TAYLOR
Member of Congress
The oil spill out in the Gulf is a big deal to all of us. It's deadly serious. Like you, I very much want to see the oil leak capped as quickly as possible. In fact, I wrote Secretary of Defense Robert Gates on Friday urging him to make available all of the resources of the U.S. military to help in the effort to stop the spill and mitigate its effects, and I spoke personally with Admiral Gary Roughead, Chief of Naval Operations for the Navy, who assured me that every resource of the United States Navy has been made available.
The good news is that because the oil rig was so far out to sea, the Mississippi coast is a long way from the source. As of today, there is no oil in the Mississippi Sound. That works in our favor.
On Saturday, I saw firsthand that the oil was further away from the Mississippi Sound and the Louisiana Marshes than the media had reported and predicted. Several days of heavy seas helped to break down some of the oil into a thin sheen. According to experts such as Dr. Bill Walker, Director of the Mississippi Department of Marine Resources, most of that oil sheen will evaporate in direct sunlight.
The thicker portions of the oil spill were still further offshore, closer to the source of the spill, so we still have time to prevent the worst-case scenario from happening. I have conferred with Admiral Thad Allen, the Commandant of the U.S. Coast Guard, and Captain Ed Stanton, the Federal On-Scene Coordinator for the Coast Guard, and I am confident that they are doing everything possible to minimize and mitigate the impact of the oil spill.
The people working to contain the spill have been encouraged that the dispersants sprayed on the oil at the surface and released near the oil leaks 5,000 feet below the surface are achieving the desired result of breaking-up the oil into smaller droplets and oil sheen—which, again, can more easily evaporate or naturally degrade. This is good news.
Thankfully, it appears that we are going to have a few days of good weather and calm seas that will allow the Coast Guard and other responders to contain and collect more of the oil-water mix and skim it into barges and tankers, or burn it in a controlled manner. Calmer winds also allow them to resume spraying dispersants from the air to continue to break up the thick portions of the spill.
Congress passed the Oil Pollution act of 1990 after the Exxon Valdez spill. Almost every response happening now is a result of that legislation that I voted for back then. The legislation calls on the oil companies to have virtually unlimited liability for the damages and the cleanup. BP is going to pay the bill, and the federal government will make sure that they do so.
I also want to make it clear that what is happening out in the Gulf is not the same as Hurricane Katrina, which was the most destructive natural disaster in our nation’s history. With Katrina, an estimated 70,000 Mississippi families were displaced from their homes, and 235 people died in our state alone.
Hurricane Katrina caused billions of dollars of property damage, of course, but it also caused substantial environmental damage. The storm surge pushed toxic chemicals, dead animal carcasses, raw sewage, and other hazardous debris all around the coastline and into coastal waters. So far, this oil spill has not caused nearly as much environmental damage as Katrina, and we all are working to keep it that way.
I continue to closely monitor the sub-surface efforts to stem the leak. I continue to work with the Coast Guard and other local, state, and federal agencies to ensure that individuals or companies that are interested in assisting with the response efforts are put in touch with the appropriate officials.
I assure you that this oil spill is being taken very seriously. But I also want to calm some of the hysteria that has resulted from those who have aired or published stories with doomsday headlines. Rather than adding to the panic, I am trying to accurately describe the current situation.
We are preparing for the worst and hoping for the best. That is how most of us live our lives. The Mississippi Department of Marine Resources is already training people to respond should help be necessary.
As a South Mississippian, I am very proud of the thousands of South Mississippians who have volunteered to help. Thank you.
Sincerely,
Rep. Gene Taylor's signature
GENE TAYLOR
Member of Congress
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