Miss. Gov. Barbour Would Rather Negotiate

Mississippi Governor Haley Barbour has commented to The Associated Press in Jackson that he would prefer to negotiate with insurance companies to encourage them to help homeowners without flood insurance rebuild their property, rather than resort to a lawsuit that could encourage carriers to leave his state.

The governor made a statement in response to a suit, filed last week by Attorney General Jim Hood, which sued major insurers on behalf of Mississippi residents whose homes were destroyed by water instead of wind. Hood said a standard homeowner’s policy should cover hurricane damage, whether the loss came from wind or wind-driven water, such as storm surge.

Insurance companies contend homeowners should have bought additional flood protection. The governor said forcing the companies to pay for flood damage could bankrupt hem and drive them elsewhere.

“It’s crucial that people who enter into contracts keep their contracts,” Barbour told The Associated Press. “And that’s what an insurance policy is—it’s a contract.”

The governor said insurance companies “must be held to these contracts.” But he also said many people, particularly those who did not live in a flood plain, did not have flood coverage.

For those people, we are working very hard so that if they don’t have insurance, or if they don’t have coverage, that we can come up with a way to help them financially, help to make them whole,” Barbour said.

Insurance Commissioner George Dale, sided with the governor. He asked the Mississippi congressional delegation to seek a bailout for those lacking insurance coverage.

“The insurance industry can take care of so many. The flood insurance program can take care of so many,” Dale said. “But there are still others out there that do not fit under either of those. We cannot let them just absolutely be made bankrupt. It would kill our economy.”

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