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Policymakers need to find a way to get banks involved in property mitigation if Florida is to improve its hurricane resiliency, according to a former state insurance commissioner.

Banks are currently unmotivated to protect mortgages through mitigation because the government steps in and bails them out when there is a crisis, Kevin McCarty, who was insurance commissioner of the state for 13 years, told the audience of the Florida Association of Insurance Reform (FAIR) Foundation’s conference in Tampa on May 2.

McCarty spoke about resiliency and mitigation, emphasizing the need for both in the catastrophe prone state.

“We know we are going to have more storms; we also know there is a lot of uninsured property,” McCarty said. “We also know somebody is mysteriously not at the table.”

He was referring to banks, which he said continue to be bailed out by the government and therefore will continue to make money no matter what. He referenced the financial crisis as an example of how banks are not motivated to protect their financial assets.

“Until banks actually have skin in the game, they are not going to be at the table,” he said.

McCarty’s said it’s important to think about what strategies could work to hold banks accountable and bring them to the table.

“If I as a taxpayer have to pay for it, it should be part of the law that if you have a federally backed mortgage you have to have an all-perils policy – and that means all perils,” McCarty told the audience, which responded with big applause.

Please enjoy the full article below;

https://www.insurancejournal.com/news/southeast/2018/05/08/488539.htm

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