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The Committee on Banking and Insurance (Posey) recommended the

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following amendment:

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     Senate Amendment (with title amendment)

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     Delete line(s) 23-28

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and insert:

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     That the Congress of the United States is requested to enact

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legislation that will allow insurers to establish tax-deferred

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catastrophe reserves if such reserves are set aside to be used

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exclusively for paying future property insurance claims arising

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out of natural catastrophes.

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================ T I T L E  A M E N D M E N T ================

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And the title is amended as follows:

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     Delete line(s) 8-19

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and insert:

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     WHEREAS, rising costs resulting from natural disasters are

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placing an increasing strain on the ability of property and

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casualty insurance companies to ensure payment of homeowners'

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claims and other insurance claims arising from major natural

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disasters now and in the future, and

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     WHEREAS, present tax laws do not provide adequate incentives

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to ensure that natural disaster insurance is provided or, where

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such insurance is provided, that funds are available for payment

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of insurance claims in the event of future catastrophic losses

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from major natural disasters, as present law requires an insurer

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wanting to accumulate surplus assets for this purpose to do so

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entirely from its after-tax retained earnings, and

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     WHEREAS, revising the tax laws applicable to the property

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and casualty insurance industry to permit carefully controlled

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accumulation of pretax dollars in separate reserve funds devoted

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solely to the payment of claims arising from future major natural

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disasters will provide incentives for property and casualty

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insurers to make natural disaster insurance available; will give

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greater protection to the nation's homeowners, small businesses,

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and other insurance consumers; and will help ensure the future

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financial health of the nation's insurance system as a whole, and

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     WHEREAS, implementing these changes will reduce the

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possibility that a significant portion of the private insurance

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system would fail in the wake of a major natural disaster and

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that governmental entities would be required to step in to

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provide relief at taxpayer expense, NOW, THEREFORE,

3/23/2008  9:09:00 AM     597-05551-08