Panel votes down bill on coastal-area insurance

March 20, 2007|By Laura Smitherman | Laura Smitherman,Sun reporter

A Maryland Senate committee voted down a bill yesterday that would have required Allstate Corp. and other insurers to write homeowner policies in coastal areas that some companies have deemed too risky.

Several legislators expressed dismay after Allstate announced last year that it would stop writing new homeowner policies in all or part of 11 counties, noting warnings by scientists that a warmer Atlantic Ocean will lead to more intense hurricanes hitting the Northeast.

Legislators held hearings in which they called insurance executives to testify, and bills were filed in both chambers.

The Senate Finance Committee vote effectively killed the bill this year, but legislators said they would continue to monitor the situation, which involves several of the state's largest insurers. State Farm Insurance Cos. and Nationwide Mutual Insurance Co. also made changes to their underwriting policies in coastal areas.

Allstate, which said it would continue to renew existing policies, has postponed its decision to stop writing new policies. The company is working with Maryland regulators who have asked for detailed financial data and information on hurricane forecasting models.

Sen. Delores G. Kelley, a Baltimore County Democrat and a member of the committee, said legislation forcing insurers to write policies in coastal areas could prompt insurance companies to leave the state entirely.

laura.smitherman@baltsun.com

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