[Congressional Record Volume 141, Number 183 (Friday, November 17, 1995)]
[Senate]
[Page S17335]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




           THE NATURAL DISASTER PROTECTION AND INSURANCE ACT

  Mr. PRESSLER. Mr. President, I am pleased to cosponsor S. 1043, the 
Natural Disaster Insurance and Protection Act.
  Our country's present method of addressing natural disasters makes no 
sense. Natural disaster relief has cost taxpayers $45 billion over the 
past 6 years. Too much of our Federal efforts are spent on dealing with 
damage after it has occurred rather than undertaking mitigation efforts 
to prevent as much damage as we can. The only way to reduce the total 
social cost of natural disasters is mitigation undertaken before 
natural disasters occur. The Natural Disaster Insurance and Protection 
Act is designed to foster these mitigation efforts.
  Presently, when a natural disaster occurs, relief efforts often are a 
political game: especially when the disaster impacts populous, 
politically important States. In addition, some areas of the country 
are particularly prone to natural disasters. Taxpayers from the rest of 
the country end up subsidizing residents of those disaster-prone areas 
through ever-increasing disaster relief payments. This subsidy must be 
reduced. Taxpayers simply should not be asked to continue to bear such 
high relief costs.
  The need for natural disaster relief funds can be reduced if 
individuals in disaster prone areas are properly insured. S. 1043 seeks 
to establish a mechanism to assure both that insurance is available in 
disaster-prone areas and to encourage individuals to purchase that 
insurance.
  The Committee on Commerce, Science, and Transportation, which I 
chair, has already held one hearing on this bill. At that hearing some 
raised concerns about the insurance entity the bill establishes. This 
is a complex and important bill. It will be further examined by 
Commerce Committee. As that examination proceeds, we need to make 
certain the insurance entity functions as intended. The insurance 
entity established should place private capital at risk and use market-
based methods to achieve appropriate pricing of the insurance offered. 
Furthermore, that insurance entity should not need, or in any way 
obligate, the infusion of Federal funds to maintain solvency.
  This bill attempts to put our policy on better footing. The Commerce 
Committee will continue its work on this legislation and it is my hope 
we can address the concerns raised and pass a bill that will establish 
a program to help victims of disaster recover while limiting the 
exposure of other taxpayers to pay for a Federal bailout every time 
disaster strikes.

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