Drywall Victim Insurance Protection Act: Prayer in H*ll?
November 18th, 2009. By AbiK
While we’re waiting on the Chinese drywall trials to get going in 2010, there’s no shortage of activity on the subject. Just yesterday, a federal bill was filed called the Drywall Victim Insurance Protection Act (sponsored by Rep. Charlie Melancon, D-La). Now, if you’re sitting in a home sniffing the sulfuric fumes, that might sound like good news, right? A bill that would prohibit insurers from canceling or altering coverage of homes that contain Chinese drywall sounds like a nice safety net for folks wondering if they’re about to be dropped from their homeowners’ policies. Ah, but there’s a rub…
The issue is that the insurance industry isn’t regulated at the federal level; it’s regulated at the state level. So, as quoted at BradentonHerald.com (11/18/09), Michael Barry, a spokesman for the Insurance Information Institute, stated the proposed bill “would have little or no effect” if passed.
Clearly that’s not what homeowners want to hear.
So why submit a federal bill that will, in effect, be meaningless?
Well, take the case of Citizens Property Insurance Corporation. They recently felt the effects of some bad press when they told a Colorado couple with a home in Punta Gorda (with, of course, Chinese drywall) that they weren’t renewing their policy. The news hit the media airwaves bigtime and wouldn’t you know it, Citizens Property reversed the decision to not renew. Translation: the more press, the more results—or so the theory would go.
And clearly that must be the thinking shared by U.S. Senator Bill Nelson, D-Fl, who was quoted via a spokesman, Bryan Gulley, in the BradentonHerald.com article as stating, “While homeowner insurance largely is governed by state laws, it doesn’t hurt to press wherever possible, and Nelson certainly supports Rep. Melancon’s effort.”
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