Column: On storms, our heads still in the sand

It's reallllly hard to write columns about insurance. First, the subject is complicated. Second, the only thing that people want to hear is that they shouldn't have to pay as much.

Hey, I like beatin' on insurance companies as much as the next guy. The trouble is that we have chosen to build a lot of stuff on top of a spit of sand that gets hit by hurricanes. Taking that risk costs money -- either on the front end, or the back end. Hence today's column.

* * *

Sorry to bring up a sore subject, but we haven't fixed this hurricane insurance thing yet.

In fact, you could argue that we in Florida have just about put ourselves in the worst possible position.

As long as we continue to be lucky, our cheerful governor, Charlie Crist, can go right on being cheerful.

But if we're not so lucky ...

We are in a lousy position both in the public insurance sector, which has taken on a big chunk of the risk, and in the private sector, which is still fouled up. [Link to entire column]

Comments

[Tom Romano]

Come on Howard, stop being such a negative nelly. Look at the people in New Orleans, they're ok....ayyy. Well, look at the people in California, they're ok....ayyy. Is that thunder I hear? Sorry, gotta run, gotta check out my insurance policy.

tom

[Larry]

While I agree with the theme of your column this morning, I can't help but wonder, how much should the premium be to insure a $400,000 concrete block home within one block of Tampa Bay? My private insuror last year tried to raise my premium from $3,700 to $6,800, and with a 5% hail and windstorm deductible. (I had been with the same insuror for over 25 years and never a claim.) Obviously, I did not renew that and sought refuge at Citizens Property Insurance Company for a premium of $3,500, which was near what I had been paying. Let's face it Howard, insurance is to cover the unexpected. It could be that we will cheerfully go through the next twelve years with no hurricanes. Will the citizens of Florida sit back and relax while the insurance companies, or Citizens, is raking in record profits for those twelve years? I doubt it. Then again, we could get clobbered in June with another Andrew across Miami and a another Katrina across Tampa Bay. Then Citizens Insurance is obviously belly up and the citizens of Florida are on the hook for the damages in the form of future assessments. We have no crystal ball. It may be that we are destined to pay annual insurance premiums of $7,000 per year (plus another $2,000 for flood insurance I might add) in which case each and every citizen of Florida will have to decide, "can I really afford to live in Florida, or should I be moving to Tennessee." It is a perplexing dilemma. Your column was right on, but I don't like it.

[Reality is NOT perception!]

Why is that we all seem to forget that life existed before the 2004 hurricane season, and 9/11 for that matter?

Our nation was safe from terrorism for decades and decades before 9/11, and the insurance industry collected and profited from decades and decades of premium payments before 2004.

Now – post 9/11 – we must give up our civil liberties in order to be safe, and now – post 2004 – we must pay excessive amounts in insurance premiums to be safe.

Meanwhile, as our economy takes a nose-dive into recession, the insurance industry and companies like Halliburton post record profits.

Am I the only one who recognizes the dichotomy in all this?
Am I the only one who recognizes the danger in “profit” by way of fear?

Wake the hell up, people; for God’s sake, wake the hell up!

[Proletariatcsp]

"A spit of sand that gets hit by hurricanes." Really? I have heard lobbists and other political laureates justify their rates in Tallahassee, largely based on sink hole liabilities for Pinellas and other northern counties. Which they somehow jumble up to a claim neatly worded for the consumers' 8th grade level of understanding as being, that of hurricane liability. Well I suppose in light of the hurricane destruction in recent years they no longer need to fabricate these fancyful tales strait out of The Perfect Storm novel. All they need is a few more tax revenue devouring counties to look the other way, just long enough to jack up the PSI in their grossly over inflated, anti-economical, stock options. States don’t charge what the rest of the country dictates, counties follow suit. That is evident in the fact that insurance prices vary from county to county. So why shouldn’t they also vary city by city, I suppose that would be far too complicated. In my opinion, any county that borders the coast line should have price equality. Why are the rates in northeast counties hovering around $1000 a year when here in Pinellas they are almost 3 times that? Especially when the majority of the county has not seen any significant hurricane damage in almost 100 years. Yet, just a couple of years ago the northeast had been hit by 3 consecutively, and they are still paying less. Florida should level the playing field and set a standard for all the counties to abide by.

[kitty]

Larry, you're getting a bargain! I have a 1264 square foot cynderblock home that the Pinellas county property appraiser says is worth $156k. I'm not in a flood zone, and in fact, don't live near any body of water. Last year, my insurance was $2700, and I expect more increases this year.

On the other hand, my brother is in evacuation zone c, and is 7 blocks from the bay. In addition to his primary structure, he has a separate apartment on the property. The combined square footage of the two structures is more than mine, but his insurance premiums were $1450 last year.

Where does Citizens come up with their system for assigning costs

[Proletariatcsp]

We were left with no choice but to increase our deductable. That brought the primium down by half. We were paying just under 3,000. Now it is much better, and if our house happens to land on the wicked witch of the west during this years hurricane season, we'll only be out a few grand. I'll gamble those odds. Shop around, there are many policies to be written as of late.

[Mary Warren]

I've been in the insurance industry for over 35 years and most comments made and articles written obviously have no inside information on what really goes on. If you really want to report why rates are so high, you may wish to attend some of the insurance fraud seminars that are conducted each year and you will find where your money goes -