WASHINGTON–House Financial Services Committee Chairman Barney Frank, D-Mass, citing a scarcity of available coverage, offered support today for a national catastrophe insurance system.
He said the lack of capacity for catastrophe risk resembles the market for terrorism coverage after the attacks of Sept. 11, 2001.
"It is clear that the government has to step in," Rep. Frank said at a press conference on Capitol Hill. Although the private market is the preferred option of lawmakers, he said the circumstances of the market for catastrophe coverage had led to a "market failure" in which private insurers simply cannot afford the exposure.
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