Category Archives: Homeowners Insurance

CoreLogic: Insured Loss (including flood) approaches $10B

CoreLogic released new estimates for losses from Hurricane Harvey:

  • NFIP insured losses – between $6 billion and $9 billion. This implies losses will hit the private reinsurance layer ($4 billion excess $4 billion, of which reinsurers bear about 26 percent).
  • Private flood insurance losses: less than $0.5 billion.
  • Uninsured flood loss: between $18 billion and $27 billion.
  • Insured wind loss: $1 billion to $2 billion.

Insured loss for Texas and Louisiana is between $7.5 billon and $11.5 billion, according to their estimates. This excludes commercial, loss of business and other, broader economic losses, according to the CoreLogic press release.

An estimated 70 percent of flood damage from Hurricane Harvey is not covered by any insurance.

 

Working with Your Insurance Claims Professional

Insurance claims professionals often are the second people on the scene after a natural disaster, arriving right after the first responders. In fact, insurers are often considered the economic first responders – because it is insurance that fuels recovery.

After you call in your insurance claim, a claims adjuster will be assigned to you. This professional investigates and evaluates your loss and helps you get insurance funds to settle your claim. While some insurers may use a single adjuster, others may prefer to use certain specialists. That means you could have more than one claims adjuster assigned to assist with filing a claim after a disaster.

For example, you may have someone meet you at your property who is an expert in construction and structural damage. Another expert claims handler could be assigned to help itemize your home’s contents. If you have flood insurance, a flood claim specialist may be called in. And, if your vehicle was damaged by flooding, an auto damage specialist would be assigned.

In every instance, the goal is to pay your claim and provide the financial resources to rebuild. Understanding the insurance claims process will help to ensure that it is a smooth one.

What Does Flood Insurance Cover? What If You Lack Flood Insurance?

The human catastrophe of Hurricane Harvey continues to unfold. The financial challenges, unfortunately, have just begun.

Nationwide over 40 percent of homeowners think the standard homeowners policy covers flood damage from heavy rain, according to Insurance Information Institute public opinion surveys.

It doesn’t. It covers a hurricane’s wind damage, not its floods. This post outlines what a flood insurance policy covers and describes federal help if you lack flood insurance.

And the misconception – homeowners insurance covers flood – has a toll. Other I.I.I. surveys indicate that nationwide only 12 percent of homeowners have flood insurance.

In Harris County, Texas, 15 percent of homes are protected by flood insurance, according to data from the federal National Flood Insurance Program (NFIP) – which sells the overwhelming majority of residential flood policies. (A few private insurers also offer flood insurance.)

The standard NFIP policy covers . . . Continue reading What Does Flood Insurance Cover? What If You Lack Flood Insurance?

The Harvey Rumor: Once More Into the Breach . . .

For heaven’s sake, even Snopes.com is taking on the rumor that Harvey claims have to be filed by Friday:

Texas House Bill 1774 does indeed introduce changes to the way property damage insurance claims are dealt with in the state, but only in the event of a litigated dispute over a claim. Most insurance claims are settled out of court, and so the potential benefit in filing a claim before 1 September 2017 (which is itself marginal) will likely not apply in most cases.

The real benefit would be in filing a lawsuit before 1 September, but for obvious practical reasons, it is extremely unlikely that someone whose home has been destroyed or extensively damaged days earlier, would be in a position to do this.

The law was signed by Governor Greg Abbott on 26 May 2017.

Meanwhile, the National Flood Insurance Program, which will be handling the bulk of claims from Hurricane Harvey, makes these points:

  • Media reports warning of reduced liabilities for insurance companies, late payment penalties, and immediate timelines for filing claims do not pertain to NFIP claims.
  •  National Flood Insurance Policy (NFIP) claims are not subject to state laws. As such, the House Bill 1774 passed in Texas does not affect flood insurance policies or claims from the National Flood Insurance Program
  • NFIP policyholders who have experienced flood damage should file their insurance claims as soon as possible to begin their recovery process, but there is no benefit or penalty in filing before or after September 1, 2017.
  • Visit www.fema.gov/nfip to learn more about the National Flood Insurance Program and how to file your Flood Insurance claim.

Consumer Tip: Be sure to check your roof

This guest post comes to us from Brad Lehman, a Texan who also went through Hurricane Andrew in 1992.

As Harvey spreads chaos throughout my current home state of Texas, I haven’t forgotten that, 25 years ago,  my Florida home sat in the path of Hurricane Andrew. My family learned a lot about life and recovery from that storm.

One lesson I can pass on to Texans: When this is over, check your roof.

A scant six months after Andrew, there was a three-day storm that blew all along the Eastern Seaboard with sustained 25- to 30-mph winds. People who got slapdash roofs after Andrew saw the thin shingles flapping in the wind. Once one shingle came loose, it affected adjacent shingles.

I had a thicker shingle put on my own house, but there was a corner of the roof that began flapping. I had some roof tar and quickly glued that portion down. (Note: I am not urging you to get on your roof, especially during the storm.)

As with Andrew, many people here in San Antonio have recently had new roofs installed because of last year’s hailstorms. Was your roofer from out of town or a discounter? Once Harvey’s clouds dissipate, take a hard look at your roof. Relentless winds expose weaknesses.

 

Impact of new TX insurance law exaggerated

A new property litigation law goes into effect in Texas on Sept. 1. Its impact has been exaggerated.  (If you read the entire story at this link, you will see that it debunks its own headline.)

If you will be filing a homeowners insurance claim, here is what you need to know:

Under the new property litigation law:

  • The claims process for filing a claim for an insurer to handle a claim has not changed.
  • Consumers still have all legal remedies available under the consumer protection laws in the event an insurer engages in bad faith conduct.
  • The Texas Department of Insurance is available to handle any complaints about insurers.
  • The new law does not take away any right to sue and does not diminish any cause of action that a person has against an insurance company. HB 1774 does, however, require notice before a lawsuit is filed.
  • The pre lawsuit notice is effective for all “actions filed on and after the effective date, which is September 1, 2017.” Any lawsuit filed after September 1, 2017, would be governed by the new law.

Texans should contact their insurance companies directly to file claims, work with your adjuster to identify all damages and coverages, and resolve your claim quickly.

A dramatic flood event that was incidentally a hurricane

On August 28, CoreLogic held a Hurricane Harvey Command Central Webinar. Here are some highlights.

Damage from rain flooding and storm surge flooding will by far outweigh wind damage from hurricane Harvey. This catastrophe can best be described as a dramatic flood event that was incidentally a hurricane, said one of the CoreLogic experts on the panel. Nevertheless, privately insured losses from wind damage are projected to be $1.5 billion to $3 billion.

Unfortunately for Houston, Harvey is in a perfect position to cause maximum flood damage to the city. The threat has shifted to catastrophic flash flooding and riverine flooding.

Insured losses to offshore energy sector are not expected to be significant as the waves were not high enough to damage platforms.

Based on CoreLogic models, there are 378,172 properties at risk from storm surge caused by a Category 4 hurricane on the Texas coast. The reconstruction cost value of these properties is over $67 billion.

Hurricane Harvey, 8/26 Evening Update

Weather Underground put it in boldface (scroll down a bit), so I think it is worth a pull-quote:

There is very little doubt that Texas is in for one of the worst rainfall and flood events in its history. The resulting rainfall is very likely to produce widespread, devastating, and potentially catastrophic flooding.

Most dire is the outlook for Houston, “given that city’s vast size and population and its well-known vulnerability to flooding.”

Good luck to all there and throughout Coastal Texas, and pardon the near-cliche, but don’t drive into water – most flood victims, I hear, are found in their vehicles.

To follow developments real-time, WU recommends:

After Harvey, if you are filing a claim . . . .

If your home was damaged by Hurricane Harvey and you have insurance, you will likely be filing a claim. We at I.I.I. have some tips to help the process go more smoothly:

  1.  Contact your insurer as soon as possible to begin the process.
  2.  Document your loss. The insurance adjuster most likely will inspect the damage, but it is a good idea to take photographs and document the damage as thoroughly as possible.
  3. Check with your insurer before discarding damaged stuff. Adjusters usually want to see proof of loss. If, however, you are required to discard them for safety, take photographs .
  4. Many insurers use text messages to notify you about the status of your claim. If so, sign up for the alerts. You’ll find out faster when your estimate is available and when a payment has been sent.
  5. Know what emergency services are available. Many companies will dispatch an approved emergency services company to protect your home from further damage. If the damage has left your home unlivable, your homeowners insurer will provide you with a check for additional living expenses.
  6. Keep a claim diary. Note everyone you speak to about your claim —  name, title and contact information. Also, keep track of the date, time and issues discussed. The better organized you are, the simpler and easier the claims process will be.

We told the media about this via a press release, which is a bit more detailed.  You can find that here. It also has information on hurricane deductibles, which I will write about in a separate post.