PCI: Secure Home in Wake of Oncoming Storms

August 12, 2004

Property owners in the Florida Keys and between the Louisiana and Florida Gulf Coast who are bracing themselves for tropical storm Bonnie and Hurricane Charley this week should reportedly check their insurance coverage and take some basic precautions to secure their homes or businesses.

“Property owners should call their agent or insurance company representative within the next 24 hours to verify the extent of coverage for flooding and storm damage,” said Don Griffin, vice president of commercial lines for the Property Casualty Insurers Association of America (PCI).

“Even if the storm ultimately fades or fizzles out, it is a good idea to take precautionary measures to prevent damage. If consumers are ordered to evacuate, they should be prepared to report claims to their insurer as soon as it is safe to return to their homes and businesses and assess the damage.”

According to the National Weather Service offices in Key West and Tallahassee, the most immediate threat is Tropical Storm Bonnie, predicted to make landfall along Florida’s Gulf Coast Thursday. A tropical storm watch is in effect along the Florida Gulf Coast from the Alabama/Florida boarder east to the mouth of the Swaunee River, which means sustained winds of 40 miles per hour or greater are expected within the next 36 hours. Bonnie is not expected to reach hurricane strength before landfall.

Hurricane Charlie is expected to threaten the extreme west Florida coast by this weekend, according to the National Hurricane Center. A hurricane watch remains in effect for the Florida Keys, from Craig Key to Dry Tortugas, which means that winds of 74 miles per hour or greater are possible within 36 hours. Visitors and non-residents have been ordered to evacuate the area.

Homeowners and commercial property insurance policies generally cover water damage from burst pipes, but do not typically cover damage arising from flooding from outside sources. Although property owners can purchase flood insurance as a separate policy through the National Flood Insurance Program, there is a 30-day waiting period before coverage takes effect.

“People with property in hurricane-prone coastal areas can purchase policies with hurricane deductibles of two to five percent of a home’s insured value,” said William Stander, PCI regional manager.

“It’s also a good idea for people who live near flood-prone areas to purchase flood insurance as well since a significant number of flood losses occur to property outside an identified flood plain.”

According to the National Weather Service, inland flooding can occur as far as 500 miles from the site of a hurricane. While flooding is not covered by a typical homeowners or business policy, coverage is available through one’s agent or company that is backed by the National Flood Insurance Program. Flooding is reportedly the most dangerous and deadly problem caused by hurricanes.

Although insurance companies are prepared to handle claims arising from a hurricane, the overall financial impact of those claims is impossible to estimate. Insurers will reportedly be ready to respond, as soon as it is safe, with catastrophe teams at the scene should Charley or Bonnie make landfall.

PCI and other industry groups constantly work with the Federal Emergency Management Agency (FEMA), part of the Department of Homeland Security, on disaster planning for both individual homeowners and businesses.

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