Hurricane damage: Who should pay?

By WND Staff

Editor’s note: Business Reform Magazine is your exclusive source for real biblical answers to real business problems.

Our hearts need to go out to those who have suffered losses, but only prudent planning will reduce future losses.

The extensive damage caused in Florida by Hurricanes Charley and Frances highlight the problem with insurance coverage of property. Ever since Hurricane Andrew, insurance carriers have been increasing insurance rates and dropping policyholders, or both. Many firms have left Florida altogether.

Millions of homeowners have just recently suffered severe damage from these hurricanes and some have been wiped out. Many are already clamoring for the government to do something.

The reality is that different parts of the country have different insurance risks. In California, it’s earthquakes, while it’s fires where I live in Arizona.

In Florida, rates have been held down based on Florida state insurance regulations. The result is that many firms have pulled out of the state while other firms have passed on more of the risks to the homeowners, with some deductibles as high as $20,000 for hurricane damage.

Rather than over-regulate, the free market needs to be allowed to operate, charging high-risk homeowners with much higher premiums. Why should a homeowner building on an exposed low-lying island pay the same as a homeowner located more prudently inland? That doesn’t make sense.

Those who build in high-risk areas need to consider the cost and availability of insurance as an expense. If they understood the true cost of insurance, then they would be reluctant to build on these high-risk sites, thus saving future property damage. Over time, homes would be built in secure locations and those who build in flood plains or other high-risk locations would pay the price rather than government agencies or other more prudent homeowners.

King Solomon wrote, “A prudent man sees evil and hides himself, the na?ve proceed and pay the penalty” (Proverbs 27:12 NASB). In the future, homebuilders need to be encouraged to build in safer sites, not attractive but high-risk sites.

Steve Marr is the former CEO of the fourth largest import-export firm in the U.S., a company which facilitated international trade for many of the largest companies in America. Currently, Steve consults with with businesses and ministries utilizing ancient Biblical principles for success in today’s marketplace. Click here to contact Steve, or visit his website at