State plans under duress

The finances of a number of US state government-managed residual market property plans in hurricane-exposed states are on shaky ground, according to a recent Insurance Information Institute white paper which argues that the credit crunch and prolonged economic downturn have exacerbated the already vulnerable financial condition of certain plans, making it more difficult for states to borrow funds. For example, Florida Citizens Plan’s exposures more than doubled from $210.6bn in 2005 to $485.1bn in 2007.