Connecticut’s proprietary insurance company, CFSIC (Connecticut Foundation Solutions Compensation Corporation), is expected to receive an additional $100 million in bond funding from the state government to handle claims from homeowners for foundation damage caused by pyrrhotite concrete. The funds have been included in Governor Ned Lamont’s two-year budget awaiting approval, and the legislature has also committed to providing $25 million annually in the future. Michael Maglala, the director of CFSIC, said that this grant will be the last batch of funds and is planned to cease operations after 2030. It is expected that by then, a total of 3,200 to 3,700 claims will have been processed, with a total payout amount exceeding 243 million US dollars.
CFSIC was established in 2019, specifically to address the housing crisis caused by concrete problems in quarries. Data shows that about 3,500 to 4,500 households across the state have been affected, but it was previously estimated that the number could be as high as 35,000. As the Supreme Court ruled that private insurance companies are not required to compensate for non-immediate foundation damage, the state government provided assistance through the CFSIC. The funds came from government grants, voluntary donations from insurance companies (such as Hartford and Lipper Mutual), and a special surcharge of $12 per homeowner’s policy. It is expected that the surcharge revenue will reach $97 million by 2030.
As of now, CFSIC has accepted 2,392 applications, paid $165.4 million in compensation, and set aside $77.8 million in reserves. President Steve Verbner emphasized that the newly added funds will be used to repair houses, restore the value of family assets and stabilize the local tax base. As the schedule progresses, the institution plans to gradually withdraw after completing 725 remaining claims and eventually cease operations by the end of 2031.
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