The Mississippi Windstorm Underwriting Association, commonly known as the Wind Pool, approved two procedures to help Mississippi Gulf Coast policyholders reduce their premiums for windstorm coverage.
Last week the Wind Pool Board approved using credits against premiums for fortified construction designed to lessen damage from hurricanes. They also created new optional deductibles of 5 percent, 10 percent, 15 percent, and 20 percent.
These concepts were developed by the Wind Pool working with the Mississippi Insurance Department. Insurance Commissioner George Dale attended the Aug. 2 Wind Pool Board of Directors meeting and said, “I applaud this effort by the Board to help with the extremely high prices that Wind Pool insureds are facing on the Gulf Coast.
Policyholders need to know that this Board is working hard and will be implementing even more innovative concepts.”
The credits for fortified construction will dramatically reduce the premium cost for insurance on buildings that meet the standards of the Institute for Business & Home Safety. IBHS is a non-profit association dedicated to reducing the damage caused to buildings by hurricanes and other natural disasters.
As part of its efforts, IBHS created a set of construction standards. David Treutel, an insurance agent from Bay St. Louis, and Vice Chairman of the Wind Pool pointed out, “The credits for fortified construction is a win – win situation. The homeowner spends a little more on the front end, but recovers the extra construction cost over the years through premium credits. The Wind Pool can charge less for coverage since the building is less likely to suffer damage in a storm. It is a long term solution for the insurance costs in coastal areas.”
The new deductibles will also provide a method to reduce premiums. Policyholders have the option to reduce their annual premiums by personally accepting more of the risk of loss.
Wind Pool Board Member Bobby Portwood, from Biloxi, recognized that high deductibles are not for everyone, but they offer real savings to businesses and individuals who can afford to personally cover part of a potential loss.
Portwood said, “A policyholder needs to carefully weigh how much deductible he can take on, but it is one more personal option that will soon be available.”
Source: Mississippi Insurance Department
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