Many Hurricane Matthew victims don’t have flood insurance

By Kelli Kennedy And Russ Bynum

THE ASSOCIATED PRESS

POOLER, Ga. _ Waist-deep floodwaters from Hurricane Matthew coursed down the street in Pooler and seeped under Lori Galemore’s doors, swamping the carpets and furniture as she and her three sons retreated upstairs, where they stayed until firefighters arrived by boat.

Galemore and her neighbours in Pooler, a community about 35 miles inland from the evacuated Georgia coast, were deluged not by seawater driven ashore by the hurricane, but by rain and runoff that overwhelmed a drainage ditch at the end of their cul-de-sac.

“Everybody said, ‘You’re not in a flood plain. You don’t need flood insurance,” Galemore said Wednesday as her husband and sons threw out soggy furniture, waterlogged books, towels and blankets and wet chunks of drywall. “And flood insurance is expensive. Who wants to pay that?”

Galemore’s story is all too common. Many Americans don’t have flood insurance, some because they don’t want to pay for it, some because they don’t see the need for it.

Even in high-risk flood zones where homes are required to have such coverage, the compliance rate nationally was only 53 per cent as of 2015, according to the government’s National Flood Insurance Program.

Industry officials say it is a troubling situation, especially since the risk of flooding appears to be on the rise.

“We seem to be having more and more flooding events, be it climate change or other things. We’re seeing areas that are experiencing flooding events that may not have experienced them in the past,” said Cynthia DiVincenti, a vice-president at Aon National Flood Services.

Ordinary homeowner insurance typically covers wind damage _ torn-off roofs, fallen trees _ but not flooding. Banks require homes in high-risk flood zones to buy flood insurance, but even then the percentage of properties that are covered is well short of 100 per cent. It was 57 per cent in Florida, 72 per cent in South Carolina and 81 per cent in Louisiana, the National Flood Insurance Program reported.

Worse, lots of flooding takes place outside those designated hazard areas. That was the case when heavy storms flooded parts of South Carolina last year and an unnamed storm recently inundated the Baton Rouge, Louisiana, area. The damage in Baton Rouge was put at $660 million, and most people there had no flood insurance.

“Flooding is the most common and costly disaster we see in the United States,” said Federal Emergency Management Agency spokesman Rafael Lemaitre. Flood claims have averaged more than $1.9 billion per year since 2006, according to federal officials.

Flood insurance in low- to moderate-risk areas averages $400 to $600 a year, according to FEMA. FEMA, through the National Flood Insurance Program, offers flood insurance because it’s generally not profitable for private insurers to sell it.

Matthew sideswiped Florida and Georgia last week before blowing ashore briefly in South Carolina and unloading more than a foot of rain on North Carolina, where it triggered disastrous flooding. The U.S. death toll is well over 30.

Walter Coker’s fish camp on the Matanzas River in Crescent Beach, Florida, was inundated. The 4-foot surge destroyed a warehouse on the property where he stores furniture imported from Indonesia. The boat slips he rents out were torn apart, with the huge wooden pilings used to hold the docks jerked out of the river bottom. Floodwaters inundated his bait and tackle shop, ruining the coolers that hold bait and beer.

Coker didn’t have flood insurance.

“I did look into it. It would’ve been very expensive,” he said. “It’s one of those things you don’t buy it on something you don’t think will happen.”

The floodwaters were waist-high inside Kathy Finger’s elegant two-story brick home with crystal chandeliers in Nichols, South Carolina. Now she is unsure how to proceed without flood insurance.

“I wouldn’t imagine that hardly anyone had it,” the 67-year-old said of her town near the Lumber River. The river had never overflowed before, and no one had any reason to fear it would, she said.

Homeowners without flood insurance may qualify for federal grants for shelter and food, but those are typically small sums and aren’t meant to replace all losses. Homeowners can also apply for low-interest disaster loans, which must be repaid.

Paul Mueller estimated his Pooler home has up to $80,000 worth of damage from the foot of water in his house. Like his neighbours, Mueller doesn’t have flood insurance either.

“We’re all in the same boat here,” he said.  “If we had trees to come down on our houses, we’d have been covered. That’s the sad truth.”

Flood damage total at least $10M, premier’s office confirms

Source: CBC | Newfoundland & Labrador

The cost of repairing damage across Newfoundland from flooding and road washouts in the wake of Hurricane Matthew will be much higher than first thought.

Premier Dwight Ball’s office confirmed late Thursday morning that the repair bill will total at least $10 million.

Earlier in the week, Ball estimated damages would be at least $1.5 million, the threshold to qualify for federal assistance.

Whatever level of government pays, repairs are continuing, according to the Department of Transportation and Works, with road links being restored to communities cut off by the torrential rainfall.

Route 340 to Michael’s Harbour, near Lewisporte, has reopened, along with Route 352 to Phillip’s Head, near Botwood.

A number of secondary roads in Notre Dame Bay, through Norris Arm North, Northern Arm and Charles Brook, as well as Route 340 to Embree and Little Burnt Bay and Route 341 to Brown’s Arm had one lane open.

While the Conne River intersection at Route 360 was open, the portion of road near Cat Brook had reduced lanes in sections and Swanger’s Cove Bridge on Route 361 was still closed.

Route 364 to Hermitage remained closed, with one lane due to open by Thursday evening and the road from Musgrave Harbour to Aspen Cove was also closed.

Applications for relief

In the meantime, applications to the Newfoundland and Labrador Disaster Financial Assistance Program are being accepted.

Liberal MP Scott Simms said the first assessment of damage will be done by the province, and the federal government’s assistance will be focused on the medium and long term.

Simms told CBC Radio’s Central Morning Show that applications will be channeled through Ralph Goodale, the minister of public safety.

“[Residents] apply under the disaster assistance arrangements program, and they can get up to 90 per cent reimbursement for the damage. My job now is to go around and make sure that everyone is OK, and we move from here and see what kind of work that we need to do.”

Scott Simms is the Liberal MP for Coast of Bays—Central—Notre Dame. (Liberal Party of Canada)

Simms said the only federal assistance to the province so far has been search and rescue.

“I advise people — like [with] what happened around Igor — check on your neighbours, check on the most vulnerable — the elderly, young children — make sure everyone’s OK and then we [can] get on with the cleanup,” Simms said.

Homeowners, small businesses, non-profit organizations and communities can apply for government disaster relief.

Residents should contact their insurance companies first to help alleviate further damage, a provincial government release stated.

For more information and advice from the provincial government click here.

Closed US restaurants, damaged homes: Matthew may cost $10B

By Christopher S. Rugaber And Russ Bynum

THE ASSOCIATED PRESS

Hurricane Matthew impaired or destroyed more than 1 million structures, forced businesses from Florida to North Carolina to close and put thousands temporarily out of work.

Goldman Sachs estimates the storm probably caused $10 billion in damage overall. Insurance companies will likely be liable for about $4 billion to $6 billion of that total, according to an estimate Saturday by CoreLogic, a real estate data provider.

In many affected areas, small-business owners were still assessing the damage, but figures suggest Matthew’s effect on the broader national economy will be minimal.

Though damage estimates are usually revised higher after more comprehensive assessments, the current figures would still make Matthew the 22nd-worst storm since World War II.

canada-press

Muskoka residents launch $900 million suit against province over flood damage

By Keith Leslie

THE CANADIAN PRESS

TORONTO _ Residents, cottage and business owners on some of the biggest lakes in Muskoka are launching a $900-million class-action suit against the Ontario government because of flooding caused by high water levels.

People living on Lakes Muskoka, Lake Joseph and Lake Rosseau say they suffered extensive damage during this year’s spring thaw because of high water and drifting ice that wreaked havoc on docks, boat houses and their properties.

The Ministry of Natural Resources is responsible for controlling water levels in the lakes, and the residents blame poor management and negligence for allowing the levels to become dangerous.

The ministry issued a statement Thursday saying it was “sympathetic” to those who had property damage, but adding that severe weather conditions are out of its control and that the spring melt was earlier and faster than normal this year.

“Over 170 mm of precipitation fell over a very short period of time, combining with high winds and ice flows to cause severe spring flooding,” it said. “We have lowered water levels in ministry dams when appropriate. Lowering water levels may provide limited relief from flooding, (ministry) dams were not designed to be flood control structures and don’t have the capacity to store or hold back flood waters.”

Lawyer Troy Lehman said the extent of the damage is “enormous” but the actual cost of repairs is still unknown, and most residents have not been successful in making insurance claims.

“We picked that number because we don’t know the actual amount,” he said. “Conservative estimates would say property damage could be in the hundreds of millions of dollars, and that’s why that large number was picked, but we will gather that information as people come forward.”

Peter Burgess, the representative plaintiff in the proposed class-action suit, which has not been certified by the courts, said it’s frustrating to suffer widespread property damage and not be able to afford to fix it.

“It’s a terrible feeling to have something crushed by the elements,” he said.

The Burgess family waterfront property on Lake Rosseau was flooded twice in the past few years, and its two-storey boathouse collapsed this spring and could cost up to $700,000 to rebuild.

“Insurance companies don’t insure wharfs or docks due to flooding or ice damage, but they do insure due to wind damage, so I had to build the argument that it was due to all three elements,” said Burgess. “So I still have no money from (the insurance company). They’re throwing some scraps on the table.”

Cassandra Ford, who operates a marina and restaurant in Bala, said she is looking at up to $400,000 to rebuild a damaged boathouse.

“Nobody seems to care,” she said. “They don’t care.”

Ford wants the ministry to explain why there was no flooding for 60 years and then three major floods since 2010.

“Prior to the 2006 Muskoka Watershed Management Plan we had high water but we didn’t have constant flooding,” she said.

In addition to monetary damages, the suit also aims to secure a judge’s order that would force the ministry to address the issue and maintain safe water levels.

canada-press

Insurance industry struggles with increasing costs of natural disasters

By Ian Bickis

THE CANADIAN PRESS

CALGARY _ Canada’s insurance companies, are grappling with an increase in environmental disasters and say property owners most at risk are likely going to have to pay more.

Craig Stewart, vice-president of federal affairs at the Insurance Bureau of Canada, says the industry sees severe weather as a top priority nationally.

“There are clear trends towards a warming atmosphere that have resulted in more significant losses from flooding… and as we’ve seen recently wildfire,” he said.

The industry is still tallying up the cost of Alberta’s Fort McMurray wildfire, but with claims estimated at $3.6 billion, the costliest natural disaster in Canadian history is already hitting insurers.

Joel Baker, president of MSA Research Inc., says this year will likely go down as the worst in decades for Canada’s general insurance sector, which excludes life insurance.

He said that in the first six months of 2016 Canadian insurers reported a $1.08-billion underwriting loss, compared with a $1.05-billion gain for the first six months of 2015.

Much of those losses will, in turn, be covered by reinsurance companies, which provide insurance for the insurance industry itself. But with a clear trend of increased natural catastrophes, insurance companies are looking for ways to better manage the risk.

Ulrich Kadow, head of Canadian operations at insurer Allianz Global Corporate & Specialty, says the industry is working to improve modelling and catastrophe exposure management to deal with the increased risk and volatility.

“The significance of these fires as a result of climate change is huge,” said Kadow.

“We need to make sure that we are on top of all these trends that evolve and develop.”

He said the industry is responding by looking at adjusting pricing, but hyper competition in the industry means companies have been limited in how much they can increase rates.

Kadow says the insurance industry is also being squeezed by low returns on investment, a key pillar in the industry’s financial health.

“It’s a double whammy,” he said. “On the underwriting side investments have been squeezed, and on the investment side the picture isn’t much rosier, either.”

Stewart says the industry has been adapting to lower rates for years, and can sustain a hit like the Fort McMurray wildfire, but longer term there are concerns.

“The industry’s well equipped to handle events such as Fort Mac. We can absorb it in any given year,” he said.

“It’s the cumulative effect of these events that can take a toll, year after year after year.”

He said partnerships with government at all levels is key to reducing future costs of natural disasters, and that IBC has been pushing the federal government to prioritize a national flood strategy as part of the upcoming national climate strategy.

Property owners also need to learn how to protect themselves, whether it’s through fire-resistant shingles or better planning of greenery around the home, while communities also need to plan more for flood and fire mitigation.

“People need to know what their risk is, and they need to be empowered to protect themselves,” said Stewart.

As natural disasters and costs to the industry increase, he says there won’t necessarily be industry-wide rate increases, but companies will have to adjust premiums when they identify areas of greater risk.

“Generally, homeowners will start to pay out of pocket as climate impacts become less of a future and more of a present danger,” he said.

canada-press

Edited for ILSTV.com

Fort McMurray wildfire recovery ‒ do you need answers?

Most insurance claims from the Fort McMurray wildfire – the largest natural disaster in Canadian history – are progressing well. However, Insurance Bureau of Canada (IBC) is aware that a few people are dissatisfied with the decisions that have been made on their claim or with the pace of the recovery process.

Bill Adams, Vice-President, Western and Pacific, IBC, reaffirms the home, car and business insurance industry’s commitment to the residents of Fort McMurray. “We’re here to stay until the job is done,” he said.

Every insurance company that writes policies in Alberta has had extra staff – claims adjusters and customer service representatives – working to help Albertans recover from the fire. In fact, more than 5,000 insurance company personnel have been deployed to work on these claims. “This is an historic undertaking,” Adams said. “It’s inevitable that, in a disaster of this size, some people will not agree with the claims decision. Consumers have appeal options in these situations.”

Consumers have the following options:

  • Ask your claims adjuster for an explanation. If your claim has been declined, you have a right to know why. Ask for a clear explanation, in writing if possible. You can also request to speak with the company’s claims manager.
  • All Alberta-licensed home, car and business insurers have an ombudsperson and a dispute-resolution mechanism in place, including a complaints liaison officer. This information should be available on your insurance company’s website, or consumers can visit the Alberta Superintendent of Insurance, which also has a dispute-resolution process.
  • Call IBC’s Consumer Information Centre at 1-844-2ask-IBC (1-844-227-5422). Consumers can get unbiased advice from an insurance industry professional. You can also email us at fortmacfire@ibc.ca.

If you have exhausted the above options and still have not resolved your complaint, you can use this step:

  • The General Insurance OmbudService (GIO) is an independent, regionally based consumer dispute resolution system for the insurance industry. They provide consumers with a free, independent and impartial process to resolve complaints about home, car or business insurance. Call toll free: 1-877-225-0446.

For more information on insurance, your rights as a consumer and the complaint resolution process please visit ibc.ca.

About Insurance Bureau of Canada
Insurance Bureau of Canada (IBC) is the national industry association representing Canada’s private home, auto and business insurers. Its member companies make up 90% of the property and casualty (P&C) insurance market in Canada. For more than 50 years, IBC has worked with governments across the country to help make affordable home, auto and business insurance available for all Canadians. IBC supports the vision of consumers and governments trusting, valuing and supporting the private P&C insurance industry. It champions key issues and helps educate consumers on how best to protect their homes, cars, businesses and properties.

P&C insurance touches the lives of nearly every Canadian and plays a critical role in keeping businesses safe and the Canadian economy strong. It employs more than 120,000 Canadians, pays $8.2 billion in taxes and has a total premium base of $49 billion.

For media releases and more information, visit IBC’s Media Centre at www.ibc.ca. Follow IBC on Twitter @InsuranceBureau and@IBC_West or like us on Facebook. If you have a question about home, auto or business insurance, contact IBC’s Consumer Information Centre at 1-844-2ask-IBC.

If you require more information, IBC spokespeople are available to discuss the details in this media release.

SOURCE Insurance Bureau of Canada

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