“Out of the rubble of Trent Lott’s house — he lost his entire house — there’s going to be a fantastic house. And I’m looking forward to sitting on the porch.”—Bush, September 2, 2005
Oh how I wish some reporter would ask aquestion on this. Such as… Mr. President will you fully support an investigation of insurance fraud perpetrated against Trent Lott’s porch… oh and the thousands of other porches of the people of the Gulf Coast?
Mr. Lott, a Republican and former majority leader, is one of thousands of homeowners on the Gulf Coast who have been fighting with their insurers over payments for damage in Hurricane Katrina. In an interview yesterday, he said he was angry about the insurers’ “insensitivity and outright meanness” in rejecting many homeowners’ claims.
He said he inserted a provision into legislation, signed by President Bush last week, directing the Department of Homeland Security to investigate potential fraud by the insurance industry. Mr. Lott said he was also drafting legislation to challenge the industry’s exemptions from antitrust laws and had asked his staff to investigate the industry’s tax rates.
“I am outraged,” he said. “I’m concerned there are lots of abuses in the aftermath of the hurricane.”
SNIP
Insurance is mainly regulated by the states. But the federal government has authority on antitrust and tax issues. The insurers have been exempted from some antitrust laws since the 1940’s. These exemptions permit them to share industrywide information on claims costs and project future costs.
SNIP
Mr. Lott said he had sought the Homeland Security investigation because he believed that the insurers shifted the cost of many claims to the federal flood insurance program that they should have paid themselves.
Mr. Lott said he wanted Homeland Security to determine if the shifting of costs to the federal program “was just an occasional mistake or systematic.”
“I think it was systematic,” he said.
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