As damage estimates from Hurricane Charley are added up, a look back at Hurricane Andrew (Category 5 - 1992) provides some perspective. Insure.com notes that Andrew took 23 lives, destroyed almost 30,000 homes and damaged over 100,000 others. with aggregate loss over $15 billion, only surpassed by September 11 on the list of insured disasters. Source: Insure.com - home insurance - "10 years later, Hurricane Andrew would cost twice as much".
(read more ... )
As the impact of Hurricane Charley becomes better known, we will see how the insurance industry will react. Following Hurricane Andrew in 1992, while most insurers were able to pay claims and draw on reinsurance, several insurers with concentrations of insureds in the path of the storm became insolvent, and their losses fell on the guaranty fund. That fund had to borrow money to pay the flood of claims in order to stay afloat itself.
Since Hurricane Andrew, coverage provisions for windstorms have changed in Florida. We'll be seeing in coming months how those respond to Hurricane Charley as the loss statistics are added up. We'll also probably get some new cases to chew on, as we did following Hurricane Andrew in 1992.
The Insurance Information Institute provides a "Hot Topics" page with information on Hurricane Charley, which includes information about the Citizens Property Insurance Corporation, a Florida-regulated association offering full coverage and windstorm-only coverage in that state. CPIC replaced the former high risk pools, the Florida Windstorm Underwriting Association and the Florida Residential Property & Casualty Joint Underwriting Association.
The III's page includes summary data on the ten most damaging hurricanes (with dollar loss figures adjusted to 2003 dollars) and data on hurricane and hurricane-related deaths for the last twenty years.
Posted by dougsimpson at August 17, 2004 12:23 PM | TrackBack