Hurricanes Don't Justify our High Coastal Premiums!
Mobile & Baldwin Counties' premiums are
4 X Higher
than the rest of the state.
Yet . . .
Coastal Insurance Losses are LOWER
than the rest of the state,
according to newly released Alabama Clarity Law data.
Click on this PowerPoint presentation to see how HHII analysed the Clarity Law data.
The bar chart above shows Mobile and Baldwin counties had LOWER insurance losses than the rest of the state over the past 10 years (red bars on graph) . Yet the Alabama Department of Insurance allowed companies to charge us FOUR TIMES MORE than the rest of the state (blue and gold bars). The data includes Hurricanes Ivan and Katrina, Tropical Storm Ida & Mobile's Christmas Day tornados.
DOI IS FEELING THE GROUNDSWELL PRESSURE
As a result of the numerous complaints that the DOI and the Governor’s office are receiving about the implications of the Clarity Act data,
the DOI has decided to publish
this document on their
website explaining the shortcomings of the
Clarity Act data. HHII is
preparing a rebuttal to this document.
The Homeowners Hurricane Insurance Initiative
is the only citizens' group working for fairness in coastal Alabama regarding insurance premiums.
What can YOU do to help?
Come to one of the meetings listed below to
learn more about the Clarity Law Data
* Call, Email, or write Governor Bentley (email@example.com) and your state Senator and Representative and let them know that you want the Alabama Department of Insurance (DOI)
to follow the laws that require fair premiums statewide. Click
here for a guide to writing to the
Governor's office and more talking points..
* Print out this
flier and give it to uour friends and
* If you receive HHII's email 'GOUGED! Hurricanes Don't Justify our High Coastal Premiums!', forward it to as many coastal Alabama people you know.
Schedule of Meetings to discuss the Clarity Law Data
and what are we going to do about this
March 17, Monday 3pm
Crazy Horse Cafe in FL (Highway 98 going east from Foley, Alabama through Elberta into Lillian (not ... and 4/10ths of a mile from the state line, on the left,)
March 18, Tuesday, 11am at Government Street Presbyterian Church, Downtown Mobile (300 Government Street, Mobile, AL 36602-2618 (251) 432-1749)
March 18, Tuesday, 6:30pm at St. Paul's Episcopal Church, Foley (506 North Pine Street
Foley, AL 36535 (251) 943-2173)
March 19, Wednesday, 10am at Gulf Shores First Presbyterian Church (309 East 21st Avenue | Gulf Shores, AL 36542)
March 19, Wednesday, 6:30pm at Way of Life Community Church, DIP (1760 Riverside Drive, Mobile, AL 36605-3921 (251) 471-2735)
March 20, Thursday, 10am at St. Paul's Episcopal Church, Foley
Thursday, 6:30pm at Spanish Fort Presbyterian Church (6620 Spanish Ft. Blvd)
March 25, Tuesday, 10:30 at Way of Life Community Church, DIP
March 25, Tuesday, 6:30pm at
Theodore First Baptist Church (7125 Bellingrath Road
Theodore, AL 36582)
March 26, Wednesday, 11am at Government Street Presbyterian Church, Downtown Mobile
March 26,Wednesday, 6:30pm at Gulf Shores First Presbyterian Church
March 31, Monday, 6:30pm at St. Paul's Episcopal Church, Foley
(506 North Pine Street Foley, AL 36535 (251)
It’s enough to make you pull your hair out
Bob Morgan has a great article on
GulfCoastNewsToday.com. You can read the
whole piece there (and you really should) by
clicking on the link above but
the meat is extracted below.
'Using DOI’s own data, HHII has discovered that when Hurricane Ivan hit in 2004 four inland counties (Escambia, Monroe, Conecuh, Clarke) suffered greater losses-per-policy than Baldwin and 12 inland counties (add Wilcox, Washington, Butler, Covington, Lowndes, Choctaw, Marengo, Perry) suffered greater losses-per-policy than Mobile. Katrina in 2005? Seven inland counties (Washington, Escambia, Choctaw, Sumter, Clarke, Pike, Greene) had greater losses-per-policy than Baldwin County.
Over a 10-year period HHII’s extensive research puts coastal loss-per-policy at $622 as compared with a statewide loss-per-policy of $722, and yet the state average for full homeowners insurance is $950 compared to $1,384 for the coastal counties.
The bottom line: Why should homeowners on the coast pay 300 percent more in homeowners premiums when they actually have less losses than the rest of the state? HHII is demanding that DOI stop this unfair discrimination.'
Baldwin County is paying three times higher
than the state average.
Presenting HHII's analysis of
the data posted on the AL DOI website as a
result of the Clarity Law, Michelle Kurtz
convinced Baldwin County Commissioners that
Baldwin County was looking at geographical
discrimination. The commissioners
responded favorably to her request to consider passing a resolution calling for equitable rates and premiums across the state.
Read the Fairhope Courier's report of the
here. Watch a video of the actual
here (you will need to click on 'Search Meetings' box at upper right, scroll down to 1/21/2014 meeting and click on agenda.
The video of the meeting will start to play. Scroll down the printed agenda to item C2 and click on the link.)
View HHII's analysis of the Clarity Law data on
HHII DEVELOPING BUSINESS MODEL FOR
COASTAL BAND INSURANCE DISTRICT
has been holding a series of brainstorming
& research sessions to develop Priniples & Objectives
guiding the legislative creation of the Special
Insurance District "Coastal Band" and its
This is an ongoing collaborative effort on a
working document and all interested parties are
invited to attend. Watch the column at
right for the time and place of the next
COASTAL BAND RESEARCH SESSION
WITH AL DOI DEPUTY COMMISSIONER ANGELL
On January 25, 2014, about 15 HHII
representatives, together with State
Representative Faust and Baldwin Co.
Commissioner James, met with Alabama DOI Deputy
Commissioner Charles Angell to discuss the Coastal Band Initiative.
Mr. Angell stressed that he was not speaking for the DOI but from his own actuarial experience.
He said the Coastal Band “makes sense,” and is “a fine concept”
but a lot of devils can be found in the details.
He made the following specific points:
-- Feds will not backstop bonds
-- The significant capital advantage will be capturing the “Risk Load” reinsurance companies charge. It makes up about 80% of the reinsurance premium.
-- A significant problem will be raising initial capital and also winning credibility with mortgage companies; (need a financial rating from Demo-tech, or AM Best)
-- The board would need insurance experts in significant numbers, and maybe be the majority; this is particularly important to win credibility with rating companies;
-- Will need a business plan and involvement of actuaries;
-- Don’t mention/plan dividend returns to policyholders because all the capital will be needed;
-- DOI might be supportive of HHII/GCEC requests for studies by the new Institute;
-- The elimination of Cherry Picking should distinguish quality of structures, if not geographical areas;
-- Domestic companies might and might not come to like the idea, but will be primarily concerned about its viability;
Mr. Angell also provided sugeestions regarding the
-- Adding TIV (total insured value) to the requirements of the Clarity Law
would be helpful but might require legislation instead of a DOI regulation;
-- Loss/policy is corrupted by double-counting;
-- The DOI is exploring a regulation that requires companies to report losses and then also losses as if they imposed a
standard $1,000 deductible;
-- Hurricane models are here to stay; “you won’t win that argument.”
-- Clarity Law’s 10-years of data is too short of a window;
On HHII's proposed Parity Law, Mr. Angell
-- It’s politically impossible
-- Perhaps it should say statewide premiums must be “equally adequate or inadequate.”
-- If a company decides to pull out of the Alabama homeowners’ market because of the Parity Law, would they be required to pull out of the auto market, too?
-- Large companies might pull out of state, creating insurance chaos
COASTAL BAND RESEARCH SESSION
WITH PROBATE JUDGE TIM RUSSELL
12 people met with Baldwin Probate Judge Tim
Russell December 6, 2013. Judge Russell
has had extensive experience in the insurance
business. He also chaired Governor Bentley's Affordable Homeowners Insurance Commission and HHII found
his comments to be extremely valuable.
Judge Russell said he fully supports the multi-state concept. He has helped design Captives legislation for Alabama. It can serve as a model when developing legislation for the Band
and the Judge promised to forward a copy to
Other key points:
-- starting small will require buying re-insurance; the larger, the more states in the start-up the better;
-- premium revenue from multiple states coupled with the capacity to borrow from bond markets, backed by the federal government or an alliance of state governments
could make it possible to operate without re-insurance;
-- the Coastal Band might work well as an Insurance Captive or legislation designing it can closely follow Alabama’s Insurance Captives model;
-- Wind-pool reserves might help with start-up
– although it might take a lawsuit to get them;
in all states.
MORE GULF STATES SHOW INTEREST IN
COASTAL BAND INITIATIVE
Mississippi and Louisiana
have held public meetings to generate interest
in the Coastal Band insurance solution.
These states are also interested in persuing
their own version of Alabama's Clarity Bill.
MS State Rep. DeLano has gotten the Clarity Law passed out of the House Insurance Committee and it now goes to the Senate.
You can read the bill
New Push for Fair Home Insurance Rates
See original Channel 15TV story
There's now a push for fairness when it
comes to homeowners insurance. Companies are now required to
disclose the cost of claims and data by zip code.
The Homeowners Hurricane Insurance
Initiative says that data shows homeowners in Mobile and Baldwin
counties pay close to three times more in insurance premiums
than the state average.
The group wants more homeowners to take a
closer look, saying that if you own a home in Mobile or Baldwin
County you've been subsidizing the rest of the state for the
last 10 years. "the department of insurance said that with all
these storms by golly we must be on the verge of terrible
catastrophes every year from here on out. " "they made that
decision without using historical county by county, zip code by
zip code information," said Michelle Kurtz with the Homeowners
A spokesperson for the State Department of
Insurance says there's a higher cost of doing business in Mobile
and Baldwin and the premiums we pay are accurate.
HOW YOUR DONATIONS TO HHII ARE HELPING
Various leaders in the group who have the time have made trips to
Louisiana, Mississippi and the Florida panhandle. They've made
excellent progress building a multi state coastal grassroots network.
State Rep. Joe Faust has partnered with this initiatve and has made a significant
difference opening doors in every direction. His letterhead, calls from his office
and his occasional trips to these other states have added significantly to the "gravitas."
The work in these neighboring states has served as a prototype for the work to be done
in the rest of the coastal band -- running from Mexico to Maine. The attached
gives a sense of the cost of this prototype activity. Using their experiences, the various
people who gather to brainstorm next steps have developed a three-phase plan that brings
the grassroots in all 17 Gulf and Atlantic coastal states into a giant network that requires
officials to fix the coastal insurance crisis. Their plan hires ten people like Michelle Kurtz.
They will network the coastline in a year.
It will cost about $700,000, and the HHII steering board is working on that. They plan three phases.
The first costs about $15,000 (plus about $10,000 for the former head of the Texas Department
of Insurance to research some more specific dollar figures). The second costs about $60,000.
Both phases will be evaluated to determine whether to proceed. The third requires the rest of the
$700,000 in a lump sum. The steering committee members are looking to foundations and other sources that
can offer substantial portions of that needed amount. This board has gathered an impressive
list of signatories who will endorse a funding request made to foundations.
You can help if you know people at foundations and can open doors with them.
The "Business Plan"
A dedicated group of Alabama HHII participants are gathering and fleshing out the details of ideas for how
a special coastal catastrophic insurance district running along the coast from Mexico to Maine
should be designed and managed to best suit the consumer/family/communty.
That conversation is in the early stages. There are currently 5 ideas that are being built out.
The rule right now is to talk about all ideas, collect them on a grid, flesh them out, and
decide later which ones are best. It makes for fun conversation if anyone wants to join the
"brains" as they proceed. It's getting interesting, too, because brains from other states
will soon be joining the process.
to read a summary of the status of the discussions.
Call EMI (Dan Hanson) at 251-928-3430 if you want to get into the design conversaton.
HHII WELCOMES SPEAKING ENGAGEMENTS
HHII can fully inform your community or fraternal organization,
or church group, small or large, about what is happening with
homeowners' insurance. The presentation can be as short as
ten minutes or as long and in depth as you would like.
Call 251-928-3430 if you know of any who would be interested.
DON'T DROP YOUR FIRE & THEFT INSURANCE!
HHII has heard reports of homeowners who have dropped
insurance coverage because of unaffordable premiums. HHII urges
homeowners to maintain mult-peril (fire & theft) coverage even if they
can no longer afford wind coverage.