The National Council of Insurance Legislators last week unanimously adopted a bipartisan, American Bankers Association-initiated resolution supporting the creation of state and federal legislation to establish disaster savings accounts. Like the health savings account model upon which the concept is based, DSAs would allow U.S. residents to save on a pre-tax basis for structural improvements to resist storm damage and remediation of damage caused by natural disasters.
The DSA concept was first introduced in 2014 by former Sens. Jim Inhofe (R-Okla.) and Mark Begich (D-Ark.). More recently, the Residential Emergency Asset-accumulation Deferred Taxation Yield Act, a Florida-centric version of the Inhofe bill, was introduced Nov. 12 by Sen. Rick Scott (R-Fla.).
Three states — South Carolina, Mississippi and Alabama — have enacted state-level DSAs (called catastrophe savings accounts) and at least five more states will consider establishing DSAs next year.
