S 2286
Calendar No. 462
110th CONGRESS
1st Session
S. 2286
To establish a nonpartisan commission on natural catastrophe
risk management and insurance, and for other purposes.
IN THE SENATE OF THE UNITED STATES
November 1, 2007
Mr. DODD, from the Committee on Banking, Housing, and Urban Affairs,
reported the following original bill; which was read twice and placed
on the calendar
A BILL
To establish a nonpartisan commission on natural catastrophe
risk management and insurance, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) Short Title- This Act may be cited as the `Commission on Natural
Catastrophe Risk Management and Insurance Act of 2007'.
(b) Table of Contents- The table of contents for this Act is as follows:
Sec. 1. Short title; table of contents.
Sec. 5. Duties of the Commission.
Sec. 7. Powers of the Commission.
Sec. 8. Commission personnel matters.
Sec. 10. Authorization of appropriations.
SEC. 2. FINDINGS.
(1) Hurricanes Katrina, Rita, and Wilma, which struck the United States
in 2005, caused, by some estimates, in excess of $200,000,000,000
in total economic losses;
(2) many meteorologists predict that the United States is in a period
of increased hurricane activity;
(3) the Federal Government and State governments have provided billions
of dollars to pay for losses from natural catastrophes, including
hurricanes, earthquakes, volcanic eruptions, tsunamis, tornados, flooding,
wildfires, droughts, and other natural catastrophes;
(4) many Americans are finding it increasingly difficult to obtain
and afford property and casualty insurance coverage;
(5) some insurers are not renewing insurance policies, are excluding
certain risks, such as wind damage, and are increasing rates and deductibles
in some markets;
(6) the inability of property and business owners in vulnerable areas
to obtain and afford property and casualty insurance coverage endangers
the national economy and public health and safety;
(7) almost every State in the United States is at risk of a natural
catastrophe, including hurricanes, earthquakes, volcanic eruptions,
tsunamis, tornados, flooding, wildfires, droughts, and other natural
catastrophes;
(8) building codes and land use regulations play an indispensable
role in managing catastrophe risks, by preventing building in high
risk areas and ensuring that appropriate mitigation efforts are completed
where building has taken place;
(9) several proposals have been introduced in Congress to address
the affordability and availability of natural catastrophe insurance
across the United States, but there is no consensus on what, if any,
role the Federal Government should play; and
(10) an efficient and effective approach to assessing natural catastrophe
risk management and insurance is to establish a nonpartisan commission
to study the management of natural catastrophe risk, and to require
such commission to timely report to Congress on its findings.
SEC. 3. ESTABLISHMENT.
There is established a nonpartisan Commission on Natural Catastrophe
Risk Management and Insurance (in this Act referred to as the `Commission').
SEC. 4. MEMBERSHIP.
(a) Appointment- The Commission shall be composed of 16 members, of
whom--
(1) 2 members shall be appointed by the majority leader of the Senate;
(2) 2 members shall be appointed by the minority leader of the Senate;
(3) 2 members shall be appointed by the Speaker of the House of Representatives;
(4) 2 members shall be appointed by the minority leader of the House
of Representatives;
(5) 2 members shall be appointed by the Chairman of the Committee
on Banking, Housing, and Urban Affairs of the Senate;
(6) 2 members shall be appointed by the Ranking Member of the Committee
on Banking, Housing, and Urban Affairs of the Senate;
(7) 2 members shall be appointed by the Chairman of the Committee
on Financial Services of the House of Representatives; and
(8) 2 members shall be appointed by the Ranking Member of the Committee
on Financial Services of the House of Representatives.
(b) Qualification of Members-
(1) IN GENERAL- Members of the Commission shall be appointed under
subsection (a) from among persons who--
(A) have expertise in insurance, reinsurance, insurance regulation,
policyholder concerns, emergency management, risk management, public
finance, financial markets, actuarial analysis, flood mapping and
planning, structural engineering, building standards, land use planning,
natural catastrophes, meteorology, seismology, environmental issues,
or other pertinent qualifications or experience; and
(B) are not officers or employees of the United States Government
or of any State government.
(2) DIVERSITY- In making appointments to the Commission--
(A) every effort shall be made to ensure that the members are representative
of a broad cross section of perspectives within the United States;
and
(B) each member of Congress described in subsection (a) shall appoint
not more than 1 person from any single primary area of expertise
described in paragraph (1)(A) of this subsection.
(c) Period of Appointment-
(1) IN GENERAL- Each member of the Commission shall be appointed for
the duration of the Commission.
(2) VACANCIES- A vacancy on the Commission shall not affect its powers,
but shall be filled in the same manner as the original appointment.
(1) MAJORITY- A majority of the members of the Commission shall constitute
a quorum, but a lesser number, as determined by the Commission, may
hold hearings.
(2) APPROVAL ACTIONS- All recommendations and reports of the Commission
required by this Act shall be approved only by a majority vote of
all of the members of the Commission.
(e) Chairperson- The Commission shall, by majority vote of all of the
members, select 1 member to serve as the Chairperson of the Commission
(in this Act referred to as the `Chairperson').
(f) Meetings- The Commission shall meet at the call of its Chairperson
or a majority of the members.
SEC. 5. DUTIES OF THE COMMISSION.
The Commission shall examine the risks posed to the United States by
natural catastrophes, and means for mitigating those risks and for paying
for losses caused by natural catastrophes, including assessing--
(1) the condition of the property and casualty insurance and reinsurance
markets prior to and in the aftermath of Hurricanes Katrina, Rita,
and Wilma in 2005, and the 4 major hurricanes that struck the United
States in 2004;
(2) the current condition of, as well as the outlook for, the availability
and affordability of insurance in all regions of the country;
(3) the current ability of States, communities, and individuals to
mitigate their natural catastrophe risks, including the affordability
and feasibility of such activities;
(4) the ongoing exposure of the United States to natural catastrophes,
including hurricanes, earthquakes, volcanic eruptions, tsunamis, tornados,
flooding, wildfires, droughts, and other natural catastrophes;
(5) the catastrophic insurance and reinsurance markets and the relevant
practices in providing insurance protection to different sectors of
the American population;
(6) implementation of a catastrophic insurance system that can resolve
key obstacles currently impeding broader implementation of catastrophic
risk management and financing with insurance;
(7) the financial feasibility and sustainability of a national, regional,
or other pooling mechanism designed to provide adequate insurance
coverage and increased underwriting capacity to insurers and reinsurers,
including private-public partnerships to increase insurance capacity
in constrained markets;
(8) methods to promote public insurance policies to reduce losses
caused by natural catastrophes in the uninsured sectors of the American
population;
(9) approaches for implementing a public or private insurance scheme
for low-income communities, in order to promote risk reduction and
insurance coverage in such communities;
(10) the impact of Federal and State laws, regulations, and policies
(including rate regulation, market access requirements, reinsurance
regulations, accounting and tax policies, State residual markets,
and State catastrophe funds) on--
(A) the affordability and availability of catastrophe insurance;
(B) the capacity of the private insurance market to cover losses
inflicted by natural catastrophes;
(C) the commercial and residential development of high-risk areas;
and
(D) the costs of natural catastrophes to Federal and State taxpayers;
(11) the present and long-term financial condition of State residual
markets and catastrophe funds in high-risk regions, including the
likelihood of insolvency following a natural catastrophe, the concentration
of risks within such funds, the reliance on post-event assessments
and State funding, and the adequacy of rates;
(12) the role that innovation in financial services could play in
improving the affordability and availability of natural catastrophe
insurance, specifically addressing measures that would foster the
development of financial products designed to cover natural catastrophe
risk, such as risked-linked securities;
(13) the need for strengthened land use regulations and building codes
in States at high risk for natural catastrophes, and methods to strengthen
the risk assessment and enforcement of structural mitigation and vulnerability
reduction measures, such as zoning and building code compliance;
(14) the benefits and costs of proposed Federal natural catastrophe
insurance programs (including the Federal Government providing reinsurance
to State catastrophe funds, private insurers, or other entities),
specifically addressing the costs to taxpayers, tax equity considerations,
and the record of other government insurance programs (particularly
with regard to charging actuarially sound prices);
(15) the ability of the United States private insurance market--
(A) to cover insured losses caused by natural catastrophes, including
an estimate of the maximum amount of insured losses that could be
sustained during a single year and the probability of natural catastrophes
occurring in a single year that would inflict more insured losses
than the United States insurance and reinsurance markets could sustain;
and
(B) to recover after covering substantial insured losses caused
by natural catastrophes;
(16) the impact that demographic trends could have on the amount of
insured losses inflicted by future natural catastrophes;
(17) the appropriate role, if any, for the Federal Government in stabilizing
the property and casualty insurance and reinsurance markets; and
(18) the role of the Federal, State, and local governments in providing
incentives for feasible risk mitigation efforts.
SEC. 6. REPORT.
On December 1, 2008, the Commission shall submit to the Committee on
Banking, Housing, and Urban Affairs of the Senate and the Committee
on Financial Services of the House of Representatives a final report
containing--
(1) a detailed statement of the findings and assessments conducted
by the Commission pursuant to section 5; and
(2) any recommendations for legislative, regulatory, administrative,
or other actions at the Federal, State, or local levels that the Commission
considers appropriate, in accordance with the requirements of section
5.
SEC. 7. POWERS OF THE COMMISSION.
(a) Meetings; Hearings- The Commission may hold such hearings, sit and
act at such times and places, take such testimony, and receive such
evidence as the Commission considers necessary to carry out the purposes
of this Act. Members may attend meetings of the Commission and vote
in person, via telephone conference, or via video conference.
(b) Authority of Members or Agents of the Commission- Any member or
agent of the Commission may, if authorized by the Commission, take any
action which the Commission is authorized to take by this Act.
(c) Obtaining Official Data-
(1) AUTHORITY- Notwithstanding any provision of section 552a of title
5, United States Code, the Commission may secure directly from any
department or agency of the United States any information necessary
to enable the Commission to carry out this Act.
(2) PROCEDURE- Upon request of the Chairperson, the head of such department
or agency shall furnish to the Commission the information requested.
(d) Postal Services- The Commission may use the United States mails
in the same manner and under the same conditions as other departments
and agencies of the Federal Government.
(e) Administrative Support Services- Upon the request of the Commission,
the Administrator of General Services shall provide to the Commission,
on a reimbursable basis, any administrative support services necessary
for the Commission to carry out its responsibilities under this Act.
(f) Acceptance of Gifts- The Commission may accept, hold, administer,
and utilize gifts, donations, and bequests of property, both real and
personal, for the purposes of aiding or facilitating the work of the
Commission. The Commission shall issue internal guidelines governing
the receipt of donations of services or property.
(g) Volunteer Services- Notwithstanding the provisions of section 1342
of title 31, United States Code, the Commission may accept and utilize
the services of volunteers serving without compensation. The Commission
may reimburse such volunteers for local travel and office supplies,
and for other travel expenses, including per diem in lieu of subsistence,
as authorized by section 5703 of title 5, United States Code.
(h) Federal Property and Administrative Services Act of 1949- Subject
to the Federal Property and Administrative Services Act of 1949, the
Commission may enter into contracts with Federal and State agencies,
private firms, institutions, and individuals for the conduct of activities
necessary to the discharge of its duties and responsibilities.
(i) Limitation on Contracts- A contract or other legal agreement entered
into by the Commission may not extend beyond the date of the termination
of the Commission.
SEC. 8. COMMISSION PERSONNEL MATTERS.
(a) Travel Expenses- The members of the Commission shall be allowed
travel expenses, including per diem in lieu of subsistence, at rates
authorized for employees of agencies under subchapter I of chapter 57
of title 5, United States Code, while away from their homes or regular
places of business in the performance of services for the Commission.
(b) Subcommittees- The Commission may establish subcommittees and appoint
members of the Commission to such subcommittees as the Commission considers
appropriate.
(c) Staff- Subject to such policies as the Commission may prescribe,
the Chairperson may appoint and fix the pay of such additional personnel
as the Chairperson considers appropriate to carry out the duties of
the Commission. The Commission shall confirm the appointment of the
executive director by majority vote of all of the members of the Commission.
(d) Applicability of Certain Civil Service Laws- Staff of the Commission
may be--
(1) appointed without regard to the provisions of title 5, United
States Code, governing appointments in the competitive service; and
(2) paid without regard to the provisions of chapter 51 and subchapter
III of chapter 53 of that title relating to classification and General
Schedule pay rates, except that an individual so appointed may not
receive pay in excess of the annual rate of basic pay prescribed for
GS-15 of the General Schedule under section 5332 of that title.
(e) Experts and Consultants- In carrying out its objectives, the Commission
may procure temporary and intermittent services of consultants and experts
under section 3109(b) of title 5, United States Code, at rates for individuals
which do not exceed the daily equivalent of the annual rate of basic
pay prescribed for GS-15 of the General Schedule under section 5332
of that title.
(f) Detail of Government Employees- Upon request of the Chairperson,
any Federal Government employee may be detailed to the Commission to
assist in carrying out the duties of the Commission--
(1) on a reimbursable basis; and
(2) such detail shall be without interruption or loss of civil service
status or privilege.
SEC. 9. TERMINATION.
The Commission shall terminate 90 days after the date on which the Commission
submits its report under section 6.
SEC. 10. AUTHORIZATION OF APPROPRIATIONS.
There are authorized to be appropriated to the Commission, such sums
as may be necessary to carry out this Act, to remain available until
expended.
Calendar No. 462
110th CONGRESS
1st Session
S. 2286
A BILL
To establish a nonpartisan commission on natural catastrophe risk management
and insurance, and for other purposes.
November 1, 2007
Read twice and placed on the calendar
END
