Klein tries again to enact storm insurance

South Florida Congressman Ron Klein is making another run at legislation designed to curb the cost of homeowner insurance in states often hit with hurricanes and other disasters.

He introduced a bill on Thursday much like the one that passed the House but quietly died in the Senate in the last session of Congress.

It would create a national insurance pool that states can opt to join, backed by the federal government and financed by issuing bonds. The idea is to spread the risk and limit the liability of private insurers so they can provide affordable rates.

The bill’s prospects are somewhat improved this time, mostly because President Obama has endorsed the concept behind it.

The bill faced an uphill struggle last session because of firm opposition from the Bush administration and insurance leaders who said a government-run fund would interfere with the private marketplace and force taxpayers to subsidize risky development in storm-prone places.

House Democratic leaders got behind the bill, but the Senate took a more cautious approach by considering creation of a commission to study the matter.

It became clear that passage would depend on election of a new president who would support rather than actively oppose the measure.

Tornadoes and other disasters in various parts of the country have helped Klein make the case that every state potentially could benefit from a national pooling of resources, not just those prone to hurricanes.

``The one thing that has changed definitively is the presidency,’’ said Ben McKay, senior vice president for federal affairs at the Property Casualty Insurers Association of America. ``This bill, like everything else these days, has a great uncertainty in the Senate.’’

Another industry group predicts defeat.

``Barring any major hurricane, I think the chances of this passing are minimal at best,’’ said Blain Rethmeier, senior vice president at the American Insurance Association.

He predicted that Senate committee chairmen will block the bill, even if the White House promotes it.

``We believe there’s adequate capacity in the private market, and that this is an insurable risk,’’ Rethmeier said. ``Contrary to other risks -- like terrorism, where there’s a need for a federal backstop -- we believe there’s adequate insurance capacity to cover the risk of loss.’’