Partner Tom Dawson was quoted in Business Insurance in an article titled “Struggling NFIP staggers under Harvey.” The article examines the unknown amount of debt Tropical Storm Harvey will create for the National Flood Insurance Program (NFIP).
“What it is going to be after this event — another $25 billion? I think that would be unacceptable to most people,” said Dawson. Speaking about the NFIP's 2017 reinsurance arrangements, Dawson added “I think that layer is a total loss. But that’s what the reinsurance market is there for. This is a minor loss in the great scheme of things. We’re talking about an industry, depending on how you count, that has between $500 billion and $600 billion of capital. This is a billion-dollar loss. It’s nothing, realistically. There is a lot more capacity available. Obviously, people pay attention to the price. But there is capacity to issue the kind of coverage that a Houston might need,” he continued.
Dawson added, “Where does flood insurance reform rank among all these other issues? As weeks go by, it’s going to fade. But this is important. If you’re living in Houston, I can’t even imagine what it’s like trying to recover. Maybe this will — in a way Katrina really didn’t accomplish — be the event that really gets Congress to focus. Maybe. I wouldn’t put a lot of money on that.”