Posted by Benji Riggins on August 5, 2011 under Interesting Info | 
The U.S. set a record for the most tornadoes within a month with April’s deadly storms.
The final report for the month shows there were 753 twisters across the country, including a super outbreak on April 25-28 that killed more than 300 people in the South and Midwest.
While final death statistics are still being studied, the toll on April 27, being called the Dixie Outbreak, set a one-day record for tornado deaths since 1950. It topped the 310 deaths on April 3, 1974. Current estimates for the day range from 313 to 317 and could go higher, according to federal Storm Prediction Center data.
Follow-up studies that eliminated duplicate reports cut April’s tornado total down from the preliminary count of 875 that generated widespread publicity. But the storm center says that still tops the former monthly record of 543 tornadoes in May 2003.
Atmospheric scientists noted that April had an active weather pattern across the 48 contiguous states, with strong storms moving through the center of the country, tapping into moisture from the Gulf of Mexico as they matured across the mid-Mississippi Valley. Contributing to the thrashing were the La Nina conditions in the Pacific Ocean, unusually warm ocean temperatures in the Gulf of Mexico and the increase of moisture in the atmosphere caused by the warming climate.
Thomas Karl, head of the National Climatic Data Center, has cautioned against focusing on any single cause for the unusual chain of events, saying “clearly these things interconnect.”
The tornado death toll for the year so far is 546, including 364 in April and another 177 in May, generally the two busiest months for twisters. That total ranks this year fourth overall in tornado fatalities, still well behind the record 794 deaths in 1925.
In addition to the high tolls in April and May, three people were killed by tornadoes in June and there was one death each in February and March
By Randolph E. Schmid | August 5, 2011
Posted by Benji Riggins on January 19, 2010 under Insurance News |
A North Carolina appeals court is weighing whether to freeze or even reverse homeowners’ insurance premiums that soared by up to almost 30 percent along the coast while sliding by a third in counties farthest from the shore.
A three-judge Court of Appeals panel heard arguments last week in a lawsuit by coastal communities trying to overturn a deal struck in late 2008 between former Insurance Commissioner Jim Long and the North Carolina Rate Bureau, which represents insurers.
The municipalities argued Long approved the increases before coastal residents knew insurers had requested them and set rates at unreasonably high levels.
Attorneys for the state agency and the Rate Bureau told the judges state law makes the insurance commissioner responsible for representing consumers, and rate settlements can’t be appealed to the court by anyone else.
“Suppose the commissioner gets it wrong?” Judge Linda Stephens wondered.
“I don’t know of anywhere else where an order can be issued and there’s no right to appeal that,” Judge Martha Geer said.
A court ruling could come later this year.
Long’s decision meant that homeowners policies that were written or renewed beginning May 1 for coastal properties from Sunset Beach to Morehead City could jump 29.8 percent. Policy premiums for homes on the Outer Banks counties of Currituck, Dare, Hyde and Pamilco were allowed to rise by 22 percent, a big jump but a bargain compared to the doubling of rates that insurance companies originally sought.
The deal also allowed homeowners in 32 western counties to cut their premiums, in two counties by up to 6 percent.
The rate changes included policies written by both private insurance companies and the Beach Plan, the state’s property insurance provider for coastal properties.
The General Assembly last summer was forced to shore up the overextended Beach Plan by capping potential costs to insurers and putting every property owner in the state on the hook from a disastrous hurricane season. Some insurers had threatened to quit doing business in the state to limit their exposure to Beach Plan losses unless the program was bolstered, current Insurance Commissioner Wayne Goodwin warned last summer.
Despite the rate increases and Beach Plan reforms, State Farm decided to quit the homeowners insurance business on North Carolina’s barrier islands, spokesman Russ Dubisky said. The company is dropping about 1,600 policies that come up for renewal beginning May 1, he said.
State Farm believes its risks on the exposed islands is too great, and will also retrench in other coastal states, Dubisky said.
“We are looking to manage our exposure in other catastrophe prone areas as well as North Carolina,” Dubisky said.
By Emery P. Dalesio
January 19, 2010
Posted by Benji Riggins on December 16, 2009 under Flood |
Time is running out once again for the National Flood Insurance Program, which is set to expire on Dec. 18.
Congress passed a short-term extension in September that moved the expiration deadline for NFIP to Dec. 18, 2009. But if Congress fails to act again this week, the main source of protection against flooding for more than five and a half million homeowners could be in jeopardy, potentially costing the government and taxpayers billions of dollars.
Insurers are urging Congress to pass an extension to the NFIP before it’s too late.
“The expiration of the flood insurance program could have severe consequences on the economy and directly impact consumers,” said David A. Sampson, president and CEO of the Property Casualty Insurers Association of America (PCI).
PCI says that a continuing resolution will likely pass today that will extend the NFIP through Dec. 23. The continuing resolution will give the Senate a few more days to work on the Defense Appropriations bill, which would now extend the program through Feb. 28, 2010.
“We cannot afford to compound the economic challenges our nation already faces by allowing the NFIP to lapse,” Sampson said. “If NFIP expired, real-estate transactions in flood-prone areas could collapse, resulting in even more devastation for the housing market.”
Source: PCI
Posted by Benji Riggins on December 11, 2009 under Safety |
A recently released report from the Insurance Information Institute (I.I.I.) produced some eye-opening statistics regarding dog bites. According to the study, dog bites account for one-third of all homeowners’ insurance liability claims, costing $387.2 million in 2008, up 8.7 percent from 2007.
An analysis of homeowners insurance data by the I.I.I. found that the average cost of dog bite claims was $24,461 in 2008 (the most recent figures available) down slightly from $24,511 in 2007. Since 2003, however, the cost of these claims has risen nearly 28 percent. Additionally, the number of claims has increased 8.89 percent annually to 15,823 in 2008 from 14,531 in 2007.
From an insurance and personal safety perspective, dog ownership seems to be a place where risk management can be helpful in reducing the exposure to injury. Avoidance is the most obvious approach. Statistically 61 percent of dog bites occur at the owner’s home; and 77 percent are by the dog of a family member or family friend.
Is it the Owner or the Breed?
In September 2000, a Vet Med Today Special Report (JAVMA, Vol 217, No. 6, September 15, 2000) listed the dog breeds most responsible for the 282 bite-related fatalities between 1979 and 1998. The top five breeds (themselves responsible for 64.9 percent of all dog-bite fatalities) were:
- Pit bull (26.95 percent of all fatalities);
- Rottweiler (15.6 percent of all fatalities);
- German Shepherd;
- Husky; and
- Malamute.
Many people love and want dogs and there is some indication that pet ownership is healthy, especially for senior citizens. Dogs also provide security for persons and property. Those who choose to own a dog must apply other risk management steps to make dog ownership safer as well as enjoyable. The Centers for Disease Control and Prevention in Atlanta suggest that:
- Owners should carefully choose your pet dog by evaluating the environment and lifestyle. Potential owners should speak with a professional to determine the appropriate type of pet.
- Dogs should be neutered to reduce aggressive tendencies.
- Never leave infants or young children alone with a dog.
- Be sensitive to cues that a child is fearful or apprehensive about a dog.
- Children be taught basic safety around dogs (and reviewed regularly).
- Dogs with histories of aggression are inappropriate for families with children.
- Owners should not play aggressive games with their dog (i.e. wrestling).
- If bitten, the bite should be reported immediately.
Dog Owner Liability
States differ on how they legally view dog bites. There are three kinds of law that govern the liability or responsibility imposed on dog owners:
- Dog-bite statute: The dog owner is automatically (or strictly) liable for any injury or property damage the dog causes, even without provocation (a trespasser or someone committing a crime may be exceptions).
- “One-bite” rule: In approximately 18 states, the owner is not held liable for the first bite the dog inflicts. Once an animal has demonstrated vicious behavior, such as biting or otherwise displaying a “vicious propensity,” the owner can be held liable. Some states have moved away from the absolute application of the one-bite rule and at times hold owners responsible for any injury, regardless of whether the animal has previously bitten someone. These are known as “mixed dog bite statute states” as they apply a mixture of the “one-bite” rule and the strict liability of the previously listed dog-bite statute.
- Negligence laws: The dog owner is liable if the injury occurred because the dog owner was unreasonably careless (negligent) in controlling the dog.
In most states, dog owners are not liable to trespassers who are injured by a dog. A dog owner who is legally responsible for an injury to a person or property may be responsible for reimbursing the injured person for medical bills, lost wages, pain and suffering and property damage.
Insurer Response
Claims frequency and costs from dog bites have escalated. Insurers, who are usually responsible for these costs under Homeowners policies, are now taking this problem very seriously. In most states the Homeowners’ program has no provisions for excluding the legal responsibility for dog bites and no provisions for charging additional premiums for the increased exposure. Consequently, insurers must underwrite around the exposure. This means not accepting risks where there is a known increased exposure and deciding not to renew risks when the underwriter becomes aware of an exposure after initial acceptance. Many insurers are attempting to underwrite the dog exposure by identifying the breed of the dog in question and assessing the extent to which the exposure is increased.
Christopher J. Boggs, CPCU, ARM, ALCM, LPCS, AAI, APA, CWCA, CRIS
MyNewMarkets.com
Insurance Journal
Associate Editor
800-897-9965 x137
www.MyNewMarkets.com
Posted by Benji Riggins on July 1, 2009 under Insurance News |
Plans to cope with a storm that causes havoc along the coast could leave insurers and homeowners across the state — even those from inland communities such as Greensboro — between a rock and a hard place.
The rock: North Carolina’s current system for insuring coastal homes is driving insurers out of state, potentially making insurance more expensive and harder to find.
The hard place: Plans to make sure coastal problems don’t get out of hand could end up costing property owners who live nowhere near the coast extra premiums in the event of a disaster.
Caught in between: Companies such as Greensboro-based Alliance Mutual Insurance Co., which has 20,000 customers in the state and could find itself under water either way.
“The smaller the company, the more likely it is they could be driven out of business,” said Bob White, president and CEO of Alliance Mutual. His company insures a fraction of 1 percent of all the claims that could be paid.
Getting a home or business insured along North Carolina’s coast can be expensive. When a property owner can’t get a policy from a private company they can participate in the state’s Beach Plan, a “market of last resort.”
But insurers fear a massive hurricane or series of big storms could deplete the plan’s reserve. In that case, each company that does business in the state would be asked to pay a share of the losses based on how much business it does here.
“We can’t predict what our portion of the loss might be,” White said.
That unpredictable liability could cause problems even for those who don’t live near the beach.
Last year, Farmers Insurance announced it would no longer write homeowner’s policies in North Carolina. Company officials confirmed this week that it was because of the open-end liability from the Beach Plan.
Nationwide, which is still writing policies in the state, said it will no longer insure mobile homes here.
“What we’re trying to do is take prudent action on the items that we can control,” said company spokesman Joe Case.
With fewer companies willing to write policies, homeowners could see their premiums go up even if they live nowhere near the beach.
To prevent what Insurance Commissioner Wayne Goodwin described as “a homeowners insurance availability crisis across North Carolina,” a House committee has begun writing a law to restructure the Beach Plan.
The legislation would remake the plan from the ground up, changing everything from how annual surpluses are handled to its name. It is complex and deals with much more than recouping losses in the event of a major storm. However, the part most relevant to inland homeowners is a proposed limit on the amount insurers would have to repay the Beach Plan in the event of a catastrophe.
If the plan’s reserves were wiped out, insurers would be on the hook for at least $1 billion. After that, insurers could add a surcharge to every homeowner’s policy. That surcharge could be up to 10 percent of the homeowner’s annual policy cost per year and it could last until the losses were recouped.
Nationwide officials said they thought the average surcharge in such an event would be $60 per year.
But White of Alliance Mutual said that new buffer may not be enough for companies like his.
“It creates a huge cost to us that we then would have to pass on to our policy holders,” he said. “It’s really a double-whammy for policy holders across the board.”
White said he would like to see the cap insurers would have to pay on their own lowered below $1 billion.
Other things could also be done to encourage people at the coast to incur less risk and to encourage private companies to write more coverage.
“We want a bill where the surcharge only happens in the worst-case scenario,” said Rep. Hugh Holliman, a Lexington Democrat. His committee is due to keep working on the matter in the coming weeks, he said.
Posted by Benji Riggins on June 30, 2009 under Insurance News |
North Carolina legislators started grappling last week with how to beef up the state-created but underfunded insurance program for coastal property, and immediately confronted the possibility that all of the state’s insured property owners could pay more after a catastrophic hurricane season.
Legislation at fixing the Beach Plan was introduced in the House Insurance Committee, which will take it up again this week. The bill’s balancing act includes a proposal to cap insurers’ risks from a catastrophe and shift remaining rebuilding costs to all North Carolina policyholders.
There is now no limit on the price tag insurers could face, and several have warned they would scale back their business or quit North Carolina altogether without a cap on their liability. That could limit competition for consumers, Insurance Commissioner Wayne Goodwin said.
“I have no choice but to believe some of what the insurance companies say is true,” Goodwin said. “This is not a perfect bill, but it has protections for consumers.”
The Beach Plan was created in 1969 as the insurer of last resort. But it has ballooned as insurance companies raised rates in storm-prone coastal areas after Hurricane Andrew in 1993 and politicians extended coverage to more people. The Beach Plan now insures 170,000 properties valued at nearly $74 billion. But it has the resources to cover just a fraction of that.
The bill would allow every property insurance policy’s annual premium to rise by up to 10 percent if the Beach Plan’s claims surpassed about $2.4 billion in available assets, reinsurance and additional charges assessed on property insurance companies doing business in the state.
Each insurer could be forced to pay for claims on Beach Plan policies under regulations thats allow them to do business in North Carolina. The assessments would be besides paying off their own policy holders who suffered damage from storms.
The statewide surcharge could mean up to an extra $65 a year for the average annual homeowners premium of about $650, the state Insurance Department said. North Carolina’s homeowners insurance premiums have been among the country’s lowest, with the state ranking 35th in 2006, according to the Insurance Information Institute.
Insurance industry lobbyist John McMillan said the statewide surcharge would only kick in if the Beach Plan’s losses topped $2.4 billion.
“When you get calls about the possibility of surcharges in the western part of the state, it is very, very remote,” McMillan said.
In comparison Hurricane Hazel, the monster 1954 storm that set the standard for damage in North Carolina, would have cost more than $6 billion in current dollars, Insurance Department lobbyist Rose Vaughn Williams said.
The measure also would:
- Change the program’s name from Beach Plan to Coastal Property Insurance Pool, which is described as the insurance market of last resort for coastal properties.
- Make sure wind and hail coverage through the pool would always be 10 percent more expensive than the rate the state allows companies to charge. The pool’s surcharge for homeowner’s insurance that includes wind and hail coverage would be 20 percent.
- No longer distribute back to insurance companies surpluses accumulated during times the Beach Plan did not have to pay claims.
- Cut the maximum coverage on residential properties the pool would insure from $1.5 million to $750,000. The portion of a property’s value that exceeds $750,000 would have to be insured through a costlier excess and surplus coverage. The pool would not insure the first $750,000 until the excess coverage was lined up.
- Direct the pool’s wind and hail policies to include a deductible of at least 1 percent, which means the owner of a $300,000 home would have to pay at least the first $3,000 in damage out of pocket in the event of hurricane damage.
- Allow pool policies to be paid on an installment plan.
- List the types of damage-reducing construction features or improvements that policyholders can adopt in return for credits on their policy.
- Let the insurance commissioner forgive an insurer’s assessments to the pool if the commissioner thought it would put the company into danger of insolvency.
Posted by Benji Riggins on May 2, 2009 under Insurance News |
Homeowners in 18 coastal North Carolina counties whose homes are insured by a state-backed insurance pool shouldn’t expect a delay of higher rates taking effect May 1.
A powerful state legislator said a comprehensive effort to fix the overextended Beach Plan won’t delay the premium increases of up to 30 percent. House Majority Leader Hugh Holliman said he’s negotiating with insurance companies and state regulators for an overall solution.
The plan’s $72 billion in commitments well outstrip its ability to pay if there’s a catastrophic hurricane.
Coastal lawmakers wanted legislation postponing the higher premiums, as well as insurance deductibles and surcharges that a judge last month ordered the insurance commissioner to reconsider.
The judge’s ruling blocked surcharges the Beach Plan was set to charge on new policies as of Feb. 1. The judge also froze a planned rise in the deductible level to 2 percent of a home’s insured value per occurrence.
However, that court order did not affect premium changes scheduled to begin in May as part of a deal insurers worked out with former Insurance Commissioner Jim Long. This settlement cuts premiums for homeowners in central and western counties, but increases insurance rates on homes by up to 30 percent in some coastal counties.
Posted by Benji Riggins on February 1, 2009 under Insurance News, Office News |
Effective December 1, 2008, Farmers will be non-renewing existing homeowners policies in North Carolina as well as no longer accepting new homeowners business starting September 15, 2008. This change will not effect any other lines of insurance Farmers currently writes in the state.
North Carolina offers three plans -Fair, Beach, and Coastal- for properties not acceptable in the standard market as a result of claims, credit, or condition issues. If losses exceed the financial capability of the plans, insurers are assessed based on the percentage of homeowners business they have in the state. The Beach/Coastal plans have been growing rapidly and are considerably under funded at this time.
Although I’m sure Farmers regrets having to non-renew homeowners customers, the current hurricane assessment process has forced them to make this difficult business decision.
Since Farmers decision, other carriers have followed their lead and either started the process of non-renewing exisiting customers or discontinued the writing of new business in North Carolina.
Although the foundation of insurance is the sharing of risk over a large group, I fear the residents of North Carolina not located on the coast are being or will soon be paying a premium for their home insurance that includes the risk only the coastal properties are faced with.
I encourage you to voice your opinion to the state legislature, as they will make the final decision on how this matter will eventually play out.
Benji Riggins
