Joint Subcommittee Hearing on the Homeowners Defense Act of 2007 To Be Held on September 6, 2007

The Subcommittee on Housing and Community Opportunity and the Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises have announced a Joint Subcommittee Hearing (“Hearing”) on the Homeowners Defense Act of 2007.

The Hearing will be held on Thursday, September 6, 2007 at 2:00 p.m., 2128 Rayburn House Office Building. This Hearing may be viewed on the Internet by clicking here to be directed to the Committee’s website.

 

The House Committee on Financial Services has just released the following information with respect to the Hearing:

Washington DC – Rep. Paul E. Kanjorski, Chairman of the Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises, and Rep. Maxine Waters, Chairwoman of the Subcommittee on Housing and Community Opportunity, today announced that the subcommittees will hold a joint hearing entitled “H.R. 3355, the Homeowners Defense Act of 2007.” The bill, introduced by Representatives Ron Klein and Tim Mahoney on August 3, 2007, aims to address the growing crisis in the availability and affordability of homeowners insurance by providing an opportunity for states to responsibly plan for disasters ahead of time, while also offering emergency relief for those states that may be lower-risk regions.

The bill sets up a consortium for state-sponsored insurance funds to voluntarily pool their catastrophe risk with one another, and then transfer that risk to the private markets through the use of catastrophe bonds and reinsurance contracts. Following the risk transfer, state-sponsored insurance funds will be better protected and increasingly able to provide services for those who are not able to find insurance on their own.

The legislation further provides for loans that could be extended to any state facing a significant financial shortfall after a natural catastrophe. These common-sense provisions will ensure that states are able to provide for their citizens in the wake of a devastating event.

 

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