How much will TWIA pay on losses? With the information about reinsurance discussed yesterday, we now have a pretty good sense of what the Texas Windstorm Insurance Association’s finances are going to look like this summer. This lets us build an interactive property insurance calculator for Texas. Yes, if there’s a special session, all of this could change, but unless there is a special session and the bill that emerges out of it passes by a two thirds vote of both Houses, it won’t take effect until deep into this hurricane season anyway. So, in the mean time, what I’m about to show should be quite useful. It’s an interactive property insurance calculator for Texas that lets you see how much your claim against TWIA might be worth.
If you install a CDF player, which you can get for free right here, you will have an interactive widget appear below that produces a pie chart showing the percent of claims that TWIA will be able to pay (green) and the percent that it will not (red). You get to vary the size of the Catastrophe Reserve Trust Fund, the amount of Class 2 (or Class 2 alternative bonds) TWIA will sell, and, if all the Class 2 bonds are sold, the amount of Class 3 bonds that will sell. You also get to choose the size of the loss TWIA will face. Or, if you want to watch a movie that shows how the percentages are affected by varying these parameters, click the little arrow in the top right of the widget. The output is an easy to read pie chart that shows how much TWIA will be able to pay.
[WolframCDF source=”http://catrisk.net/wp-content/uploads/2013/06/twia-cents-on-the-dollar.cdf” width=”600″ height=”515″ altimage=”http://catrisk.net/wp-content/uploads/2013/06/Screenshot_6_7_13_12_24_PM.png” altimagewidth=”553″ altimageheight=”580″]
For those who don’t want to install a CDF player, here’s a snapshot showing some sample output.