jimwnola
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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?
"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?