Climate, Storms and Insurance — A Costly Brew

Florida's rates have soared the most, by 77 percent

Though average home insurance premiums rose 42.4% from 2001 and 2006, slightly less than the national average, along the coast, some premiums rose more than 10-fold.
In 2005 Hurricane Katrina damaged or destroyed 1,700 homes in Alabama, affecting 794,000 people in 11 counties.
Homeowners received nearly $600 million in federal disaster aid related to Hurricane Katrina’s damage and filed $1.3 billion in insurance claims.
In 2004 Hurricane Ivan's devestation propelled the U.S. government to declare 65 of the state’s 67 counties as federal disaster areas.
Ivan caused more than $1 billion in insurable losses in the state stemming from more than 200,000 claims.

95 percent of Floridians live within 35 miles of a coast, and 79 percent of insured property in the state sits along the coast.
From 2001 to 2006 average homeowner policies increased by 77%, more than in any other state.
Between 2002 and 2006 Miami Beach homeowners reported cumulative increases of 500%.
In 2004 and 2005 hurricanes caused more than $35 billion in insured losses.
In 1992 Hurricane Andrew pushed 12 insurance companies out of business and caused others to stop writing policies in the state.

Between 2001 and 2006, home insurance premiums rose 65.2%, ranking the state fifth in the nation for rising homeowner costs.
After Hurricane Katrina in 2005 insurance companies paid out more than $25 billion in claims — three times as much as in any other state.
After Hurricanes Katrina and Rita in 2005 Allstate alone paid out $2 billion in claims to residents.
In July 2006 Allstate backed down from plans to drop wind and hail coverage altogether in 18 parishes. Instead, it dropped wind and hail coverage in policies held for less than three years.
In 2005 Louisiana Citizens Property Insurance Corporation -- created to bring the state’s two insurers of last resort (the FAIR plan and the Coastal Plan) under a single, more financially sound umbrella -- took a $1.2 billion hit from the combined storms of 2005, wiping out all of the entity’s reserves.

Hurricane Katrina caused $10.5 billion in insured losses in the state.
The state received $8.6 billion in federal aid, as well as temporary housing for 102,500 people displaced by the storm.
Just days after Hurricane Katrina struck, the Mississippi Farm Bureau Mutual Insurance Company ran out of money and stopped writing all policies in the state.
Starting October 1, 2006, annual wind premiums increased 90%, more than doubling wind coverage payments for a home valued at $100,000 from $792 to $1,504.
Between 2001 and 2006, average homeowner insurance premiums climbed 63.3%, ranking the state 6th in the nation for increases.

Between 2001 and 2006, homeowner insurance premiums climbed an average of 56.4%.
Since August 2006, insurers have dropped more than 20,000 coastal policies, and insurance premiums for many property owners have increased more than 100%.
In 2006 though inland homeowners saw rate decreases of up to 10%, State Farm raised rates in coastal zones 25%.
Between 2001 and 2006, South Carolina Farm Bureau raised rates 25% in coastal counties and 7% statewide.
In May 2007, Allstate raised homeowner's rates statewide by 11.3%, but in coastal areas homeowners will see increases of up to 90% over last year.
Between 2006 and 2007 most insurers began dropping wind coverage, pushing huge numbers of policyholders into the state-run wind pool.

Between 2001 and 2006 average premiums have increased more than 50%, from $806 to $1,214.
Allstate has stopped covering wind damage in some parts of the state and stopped writing policies altogether in some coastal counties.
Steep losses from Hurricanes Rita and Katrina led to the shutdown of Texas Select Lloyds, the state’s sixth largest home insurer which had insured 154,000 homeowners in Texas.

Since 2001, premiums have climbed an average of 67.2% for the state, compared to 46.3% nationwide, ranking it among the top five states for biggest premium increases.
Hurricane Camille, which hit the Louisiana coast in 1969, caused torrential rains in the mountains of Virginia that resulted in devastating floods and $113 million in damages.
Torrential, non-seasonal rains hitting Virginia in recent years has caused a huge increase in flooding damages for the state – a non-hurricane extreme weather event exactly of the type scientists predict we’ll see more of due to global warming.
In 2003, Hurricane Isabel, a 600-mile-wide storm that first made landfall in North Carolina’s Outer Banks, pushed through Virginia, causing $625 million in damages and 36 deaths.

Posted: 01-Jan-1900; Updated: 02-Nov-2007