Home Insurers Biting Their Nails about Hurricane Season
Posted in Home Insurance , Hurricane Insurance
July 24th, 2009
It’s been rumored that life and property insurance agents have been biting their nails ever since the onset of hurricane season a few weeks ago. No one is looking forward to the prospect of another Hurricane Katrina wiping out any part of the country. But with enormous payouts at the forefront of the insurance industryafter a natural disaster, those who will be responsible for sending out payments for damages are a little nervous about this season to say the least.
As you can imagine, the property sector is biting their nails pretty hard about potential payouts, but experts say that the life insurance counterpart has actually suffered more financially because their payouts are usually larger and more frequent. In fact, the property sector, as of the end of 2008, is sitting on $456 billion, more than enough to cover the hurricanes that may make themselves known this year.
However, previous funds aren’t all that pay for natural disasters. Insured individuals have to keep up their payments in order to redeem their coverage. For instance, in areas like Florida where hurricanes are more frequent and funds sparse, everyone is biting their nails. This is especially true after suffering through Citizens Property Insurance Corp. – a low-cost insurance option for Floridians – being tapped out in 2004 and 2005.
Because states like Florida can run out of money, insurance companies are expected to cover their bases by increasing insurance rates – some possibly up to 500%. If this is a concern for you, you might consider adding shutters or roof reinforcements to avoid shoulderinghigher rates – that is, if you can afford this option. Many would rather accept the higher monthly premium.
With the news of a potentiallytough hurricane season, large payments, and increased rates, everyone’s biting their nails. The most everyone can hope is that we’re graced with only a few mild tropical storms this season.
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