Sweeney re-introduces Catastrophe Fund bill

TRENTON – First submitted to the Legislature in 2008, state Sen. President Steve Sweeney, (D-3), West Deptford, re-introduced the “New Jersey Consumer Catastrophe Preparedness and Protection Act” this week, which would create a New Jersey Catastrophe Fund.

The bill, S3015, was first introduced in 2008 with Sweeney and then co-sponsor state Sen. Jeff Van Drew, (D-1), Dennis Township, but it did not even have a Senate Commerce Committee hearing.

The concept is a public-private partnership that ensures “financial assistance to families that are victims of catastrophes, enhances prevention and mitigation measures (in case of catastrophe), improves recovery and rebuilding processes and educates homeowners on issues surrounding catastrophe management.”

The bill states, “Exposure in New Jersey to major catastrophes is greater than commonly understood, particularly catastrophes involving hurricanes, earthquakes and other natural disasters. All New Jersey residents, regardless of location, are susceptible to the devastating and unpredictable consequences of catastrophes, thereby necessitating a statewide preparedness and proactive program of catastrophe management.”

It cites a “compelling state interest in maintaining a viable and orderly private sector market for property insurance” as “valid and necessary exercises of the police power.”

Catastrophes referenced in the bill include tsunamis in Asia, earthquakes in California, and hurricanes Andrew, Wilma, Katrina, and Rita. The bill is necessary, according to the sponsor, “Given the scope and magnitude of hurricanes Katrina and Rita, and given that New Jersey is the most densely populated state in the nation and because of the size of New Jersey, it is likely that at least a Category 3 storm may eventually hit New Jersey and cause widespread devastation throughout the state.”

According to the bill, “Investment income earned from the catastrophe fund shall be distributed to various municipal organizations by the state Treasurer in consultation with the New Jersey Catastrophe Fund Advisory Council for the purposes of state disaster preparedness programs as specified in this act.” The bill also would establish the New Jersey Catastrophe Fund Advisory Council, in – but not of – the Department of Banking and Insurance to assist the Treasurer with the administration of the fund and to develop prevention and mitigation standards.

 

Sweeney re-introduces Catastrophe Fund bill