Insurance Costs in New Orleans (1 Viewer)

[jimwnola]

Good article on insurance crisis in New Orleans. I often defend insurance companies on certain issues, but this article makes a legitimate point.


"If Louisiana were to come up with similar pointed advice about the biggest issue threatening to kill the coastal region's chances for recovery, it would be: "It's the insurance, stupid."

In my own efforts to return to my beloved city and become a homeowner once again, I have come squarely up against the enemy. Forget about the 30 or 40 or 50 percent increases you've been reading about. The reality is far darker...."


http://www.nola.com/news/t-p/otheropinions/index.ssf?/base/news-0/1163573049190480.xml&coll=1


Rather than grandstanding comments and stereotypical insults, what I would like to see is a serious examination of the methodolgy used by actuaries in how they rate and fairly distribute risks, and to what extent past and future years are considered in their determinations. Sometimes, they will take a hit, but some of that is suppose ot be absorbed by their other years, and future years. On other hand, you can't keep dishing out claims each year without an impact. Then, are policy holders in other parts of country without claims suppose to absorb any of the risk, or is each policy suppose to reflect the risk just for that property? The problem with that, as in article, the insurers aren't that specific and lump certain lower risk properties in with high rates of "New Orleans area" in general. What's fair? Is it really that risky to live here? If so, why wasn't that risk considered for rates prior to Katrina? If we are paying the high premiums, after the fact, for the claims just paid, can you even say it is "insurance" we have been buying?

 

[johnnyd]

My wife told me a story she read in the paper about a lady who tried to buy house in the Quarter recently that had no damage from Katrina. The house was about a half million which she could afford but when she found out that he insurance was going to almost double her note she had to back out of the deal.

 

[gaminerie]

This is why i am upset with my father for buying in the Quarter. However, i haven't seen his insurance bill from his house Uptown.

Shame on these robber insurance companies. Especially since it's been clearly shown that 9 times of 10, they have no interest in payout anyway. So why jack people on premiums if not re: greed? i'm not looking forward to paying my father's note and insurance when he can't.

 

[JimEverett]

From the way I see it, New Orleans premiums shouldn;t be any higher than any otehr city along the Gulf Coast or south Atlantic. As the article points out - flood damage is not paid by these insurers, and since that is what makes New Orleans somewhat unique amongst the Gulf and south Atlantic states the idea that New Orleans premiums should be higher makes no sense.

 

[Shawn]

Aside from the fact that insurance companies posted record profits last year--despite claims they would implode under the weight of Katrina payouts, consider this: insurance claims are typically paid out as a balance minus whatever the government pays out, correct? So if FEMA reimburses you for damage to your property, that payout is subtracted from whatever the insurance company decides it owes you. So in effect, for the insured, government payouts are just a subsidy for the insurance companie.

I have absolutely no sympathy for insurance companies. They may cry a river, but their business is about as risky as running a Casino.

 

[efil4stnias]

From the way I see it, New Orleans premiums shouldn;t be any higher than any otehr city along the Gulf Coast or south Atlantic. As the article points out - flood damage is not paid by these insurers, and since that is what makes New Orleans somewhat unique amongst the Gulf and south Atlantic states the idea that New Orleans premiums should be higher makes no sense.

The problem is those who DIDNT carry flood insurance are now suing thier respective Homeowner carriers to make up the loss.
How many people do you know, immediately before evacuation, toted thier 60" big screen tv and $5000 home theater into the "attic" for safe keeping?

As with anything in this world, the good ultimately pay for the few bad apples.